How to Adjust Book Value for Specific Fixed Asset

Back Again.

It is essential for one of our customers to evaluate the book value of their fixed asset, so they can stop depreciation on a particular fixed asset. On the following scenario we will demonstrate how to adjust the book value of a fixed asset, so it will no longer depreciated even there is a capability to continue depreciate the fixed asset.

The Acquisition cost of the Fixed Asset is 12000 EGP, and he Run Depreciation for 3 Months (Straight Line Method), The Useful life of the fixed asset is : 1 Year. The Depreciation Value each month will be 1000 EGP.

By calculating the depreciation, the Book Value of the fixed asset after 3 months will be 9000 EGP (12000 – (1000*3)).

Scenario 1: The fixed asset will no longer be used even there is still 9 Periods have to be calculated, so the depreciation will no longer be depreciated on this fixed asset.

The Following Procedures must be done to ensure no depreciation will be calculated again, like as follows:

1. Open The specific fixed asset.
2. Open Depreciation Book Fast Tab.
3. Click on “Add More Depreciation Book” Hyper link to switch to the grid view.
4. Add Column “Ending Book Value” by choose columns and add this field.
5. Enter the amount of the specific Ending Book Value, In this case you will enter the same value of the “Book Value” as it is the “Ending Book Value” = 9000 EGP
6. If you run “Calculate Depreciation” on this fixed asset, the system will no longer calculate the depreciation.

Scenario 2: If the fixed asset book value will be Re-evaluated again with an amount less than the current book value, so the system will calculate the depreciation to the specified amount in the Ending Book Value.

By following the last example, Let’s assume that the Evaluation of the fixed asset become 8500 EGP, and the current book value of the fixed asset is 9000 EGP.

By following the last procedures, you will do the same steps from 1 to 4. In step 5 you will enter the amount of the Re-Evaluated Book Value of the fixed asset in “Ending Book Value” Field.

In Step 6, The system will calculate the depreciation on the ending book value 8500, so the depreciation of 4th Month will be calculated with 500 EGP (9000-8500).

Have a nice day.