Defining depreciation calculation methods

Depreciation calculation methods define how annual depreciation is calculated. Depreciation calculations for an asset are based on the asset's in-service date, depreciation method, life, and convention.

Note: These methods do not apply to Part 32 (Class Level) books.

How is asset class depreciation calculated?

The Asset Management application provides twelve predefined depreciation calculation methods. In addition, you can use the Asset Management application to define custom methods that meet your requirements. You can define custom depreciation calculation methods that use compute statements, percent tables, or units of production tables.

This procedure outlines the process for defining custom depreciation calculation methods.

Define a depreciation calculation method

  1. Access Methods (AM02.1).
  2. Specify or select D (Depreciation) in the Type field.
  3. Define a custom depreciation method by defining either a compute statement, a percent table, or a unit of production (UOP) table.
    Note: Do not use this form to define a compute statement for a Part 32 book. Details on defining a compute statement for a Part 32 book are found elsewhere in this user guide.

    Defining a compute statement for a Part 32 book

    • Define a compute statement on the Compute tab.

    • Define a percent table on the Percent Table tab.

      You must define a percent table for United States Federal tax depreciation calculations for assets placed in service between 1981 and 1986. Depreciation for such assets must use the Accelerated Cost Recovery System (ACRS). Consult your tax advisor before you set up ACRS percent tables.

    • Define a UOP table on the UOP Table Year 1–13 or UOP Table Year 14–26 tab.

Related reports and inquiries

To Use
Load dictionary values you can use to define a compute statement Dictionary Load and Listing (AM550)
Access a list of the predefined Asset Management depreciation calculation methods Dictionary Load and Listing (AM550)
List all custom depreciation calculation methods System Setup Listings (AM200)
Related topics