Sample Computation for Asset Revaluation when Revision Rules = Remaining Life

Sample computation for Asset Revaluation when Revision Rules = Remaining Life.

1. Consider the following values of the fixed asset record:

Asset Original Cost = 45,000
Residual Value = 0
Asset Lifetime = 60
Accounting Method = Straight Line
Current Net Book Value = 42,000
Cumulative Depreciation = 3,000
Last Depreciation Amount = 750
Last Depreciation Period = 4
Revision Rules = Remaining Life

Note: Expected Net Book Value = 28,000 to be depreciated over the remaining life of the asset.

2. Go to Fixed Assets > Transactions > Asset Revaluation.

3. Select the asset above, and enter 14,000 (42,000 - 28,000) as the Write-Down amount.

4. Adjusted Depreciation Method = Straight Line Remaining.

5. Enter a Transaction Reference and Transaction Date.

6. Click Process Revaluation.

7. Go to the asset record and find the following updated values:

Main Header:
Asset Original Cost = 45,000
Asset Current Cost = 31,000
Residual Value = 0
Asset Lifetime = 60
Accounting Method = Straight Line Remaining
Current Net Book Value = 28,000 (42,000 - 14,000)
Cumulative Depreciation = 3,000

General tab:
Last Depreciation Amount = 750
Last Depreciation Period = 4
Last Depreciation Date = 2/28/2013

Depreciation History:
History entry for Write-Down = 14,000

8. Process the next asset depreciation for Mar 2013 (3/31/2013).

Actual result:
Depreciation Amount should be 500.00 (28,000 / 56) (Current Net Book Value / Remaining Life of the asset)