Example: compute depreciation for previous period and previous year

If an invoice has a Compute Option, then the previous period and the current year that is received for a desk is delivered in the previous fiscal year.

  1. After adding the asset, use the Compute Option to calculate the depreciation expense for any previous periods in the current fiscal year.
  2. Create General Ledger journal entries to post the accumulated depreciation for any previous year depreciation expense.
  3. Use the Depreciation tab in Books to view the year-to-date and life-to-date depreciation amounts.
    System-generated entries Debit Credit
    Asset X
    Asset clearing X
    Depreciation expense (previous period, current year) X
    Accumulated depreciation (previous period, current year) X
    Manual entries Debit Credit
    Depreciation expense (previous year) X
    Accumulated depreciation (previous period) X

effect on General Ledger

Both the system-calculated prior period depreciation amount and the manually created prior fiscal year depreciation amount is transferred to General Ledger in the current month. The current month depreciation expense is calculated during fiscal period close.