Imagine that an invoice is received for a desk that was delivered
in the prior fiscal year.
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Use the compute option (when adding the asset) to
let the Asset Management application calculate the depreciation expense
for any prior periods in the current fiscal year.
Note: AM20.4 will display the correct life-to-date amount, but prior year
depreciation will not be posted to the General Ledger unless you create
a journal entry.
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You must create General Ledger journal entries to
post accumulated depreciation for any prior year depreciation expense.
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Use the Depreciation tab on Books (AM20.4) to view the year-to-date and life-to-date depreciation
amounts.
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System-Generated Entries
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Debit
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Credit
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Asset
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X
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|
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Asset clearing
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X
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Depreciation expense (prior period,
current year)
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X
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|
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Accumulated depreciation (prior period, current
year)
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X
|
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Manual Entries
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Debit
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Credit
|
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Depreciation expense (prior year)
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X
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|
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Accumulated depreciation (prior period)
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X
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Effect on General Ledger account balances
Both the system-calculated prior period depreciation amount
and the manually specified prior fiscal year depreciation amount is transferred to the General Ledger application in the current month.
The current month depreciation expense is calculated during
fiscal period close.