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Dynamics 365 Community / Forums / Finance | Project Operations, Human Resources, ... / Depreciation for an ad...
Finance | Project Operations, Human Resources, ...
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Depreciation for an addition to an asset that is fully depreciated

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Posted on by PK-29011343-0 4
How do I
a) add an addition to an asset that is fully depreciated/almost fully depreciated, so it does not adjust the cost of the asset used in depreciation calculation 
b) run a proposal for depreciation for the asset and get it to calculate the depreciation correctly, just using the cost of the addition only and or what is left of the existing asset
 
I have tried to use acquisition adjustment journal for additions, but this adds the addition to the cost and depreciation is calculated using the new total costs. 
 
 
Thanks 
Categories:
Dynamics 365 Finance
  • Suggested answer
    Bharath jain Profile Picture
    Bharath jain 889 on at
    Depreciation for an addition to an asset that is fully depreciated
    Hello,
     
    Below is the standard behaviour for straight line method. 
     
    1) Acquisition (10,000) was posted as on June 1st 2024 (life of an asset 1 year) and depreciation is posted till May 31st 2025 833.33 monthly
    2) Acquisition adjustment of 5,000 was posted as on May 31st 2025. Now the depreciation is calculated on the new cost of 5,001
     
    Kindly explain if your expecting something different.
     
    Regards,
    Bharath Jain
     
     
  • PK-29011343-0 Profile Picture
    PK-29011343-0 4 on at
    Depreciation for an addition to an asset that is fully depreciated
    Creating a new asset would not make sense in this case, the option was explored. 
     
    So for example, building 005, almost fully depreciated in 2024, we do an expansion in 2024, which is recorded as an addition to the existing  building of 600K.
     
    How should the addition be added to the existing asset so that depreciation is calculated accordingly.  
  • Suggested answer
    Frank Hamelly | MVP, MCP, CSA Profile Picture
    Frank Hamelly | MVP... 46,237 Super User 2024 Season 2 on at
    Depreciation for an addition to an asset that is fully depreciated
    If you don't want to affect the cost of the existing asset, wouldn't it make sense to create a new asset for the addition?  You want be able to depreciate the existing asset further if its basis isn't adjusted.

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