There is often confusion with the monthly calculation of depreciation. The basic calculation is to first determine the annual depreciation for each year and then divide that by the number of periods in the year. This gets more complicated with different first year conventions and changes over the life of the asset.
Bassets eDepreciation features a Detail tab as part of the Asset Maintenance form. This provides the user with Year by Year and Month by Month detail with Annual and Cumulative Totals of the depreciation calculation for the selected Depreciation Schedule for the asset record displayed on the screen.
Pictured here is an example if $6,000 asset depreciated over 5 years with a double declining balance and half year convention.
This calculation grid shows the numbers for each individual period for the entire life of the asset. Depreciation detail can help answer questions when they arise concerning adjustments, bonus depreciation, disposals, transfers or other event changes to an asset.
In the top part of this form there is a data grid of rows (12 periods in a year with totals) and columns (each year in an assets life). Each of the “cells” represents the monthly depreciation calculation for a single period. The columns will begin with the year the asset is placed in service and continue through until the asset is fully depreciated.
Annual and Cumulative Totals
- Annual represents the Yearly depreciation amount for each year.
- Cumulative represents the Yearly cumulative depreciation for each year. The calculated amount is the Annual depreciation amount plus any previous cumulative amount.
- Remaining represents the Yearly remaining balance of an asset. The calculated amount is the Cost value minus the Cumulative total.
As you can see, the ability to view the depreciation detail behind a calculation can be very helpful in answering questions. Instead of just looking at a single cumulative number, this let’s you easily view each period for the entire life of an asset.
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More information about Bassets eDepreciation software can be found at Bassets.net. While there you can set up a demonstration, download a free evaluation copy and get a personalized pricing estimate.