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Microsoft Dynamics GP (Archived)

Straight Line Depreciation not calculating correctly

Posted on 4 May 2015 21:36:33 by Microsoft Employee

Ok so I'm currently entering in assets into the fixed asset module and I can't seem to figure out how GP is calculating the depreciation. Here is the relevant information

 

Cost Basis: 80,809.50

Place in service date: 12/29/14

Dep to date: 12/28/14

0 LTD and YTD

Life: 5 years 0 days

Dep method: Straight line Orig

No Averaging Convention

No Switchover

So based on all of this I am expecting the period depreciation to be $1,346.83 (80,809.50 / 5 / 12 ) since there isn't any depreciation taken on it yet. That would roughly $44.89 per day. However, it is calculating out periodic depreciation to be $1,571.30 and daily depreciation to be $50.82.

For the most part changing the averaging convention does very little but I set it to none because I want the assets to depreciate exactly based on their placed in service date. However, when I change the depreciation method to SL remaining life, it calculates periodic depreciation to be $1,368.22. This is better but still off from what I would expect.

 

Does anyone have an idea?

*This post is locked for comments

  • Redbeard Profile Picture
    Redbeard 12,931 on 21 Nov 2017 at 23:29:17
    RE: Straight Line Depreciation not calculating correctly

    Bari -

    Dynamics GP using Straight Line Original Life will only calculate depreciation for each period in the year, not the whole year; barring any settings changing the way it calculates. 

    So, in 2017, you should see 8 periods of depreciation, and then only 4 periods of depreciation in year 6.

    Glad I could help.

  • Community Member Profile Picture
    Community Member Microsoft Employee on 21 Nov 2017 at 20:09:07
    RE: Straight Line Depreciation not calculating correctly

    I deleted the asset and re-entered. I appears it is correct now, expect the Yearly Depr. Rate is still showing at 8 months (May - Dec), does the Yearly Depr no show a full 12 months using SL Original Life method?

    The good news is I did this in test company to figure out the errors.

    Thank you so much for all your help. I truly appreciate it.

  • Suggested answer
    Redbeard Profile Picture
    Redbeard 12,931 on 21 Nov 2017 at 19:53:43
    RE: Straight Line Depreciation not calculating correctly

    Bari -

    As you can see from the detail activity report, there is no clear path to how the asset was added, and depreciated.  The periods and amounts jump around, and there are FACHG source documents, which indicates a depreciation sensitive field was edited on the Asset Record.

    In cases like this, I typically suggest using the Fixed Asset Delete Utility to remove the asset and re-add it to the system.  Then you should be able to rerun the depreciation through the current period, and get a clearer picture of the asset record.  It is important to make any necessary adjustments to the General Ledger for the asset, as deleting it does not reverse the GL transactions.

  • Community Member Profile Picture
    Community Member Microsoft Employee on 21 Nov 2017 at 19:26:45
    RE: Straight Line Depreciation not calculating correctly

    Detail-Activitiy-report.PNG

  • Redbeard Profile Picture
    Redbeard 12,931 on 21 Nov 2017 at 19:19:18
    RE: Straight Line Depreciation not calculating correctly

    One more thing - Please Go To Financial > Reports > Fixed Assets > Activity; select Detail Activity from the drop down, filter for the specific asset in the CORPORATE book, and run the report.  Please share the results.

  • Community Member Profile Picture
    Community Member Microsoft Employee on 21 Nov 2017 at 19:11:13
    RE: Straight Line Depreciation not calculating correctly

    Asset-Book-1340.PNG

  • Redbeard Profile Picture
    Redbeard 12,931 on 21 Nov 2017 at 19:05:43
    RE: Straight Line Depreciation not calculating correctly

    Bari - The Asset/Book Record typically inherits settings from the Book/Class record, which you included; however, it can be altered before/after saving.  If you could include the Asset/Book Record for this particular asset by going to Financial > Fixed Assets > Cards > Book, that would be great.

  • Community Member Profile Picture
    Community Member Microsoft Employee on 21 Nov 2017 at 14:25:53
    RE: Straight Line Depreciation not calculating correctly

    Below are screenshots of the setup windows, please let me know if you are looking for others?

    Book-Setup.PNG0218.Book-Class-Setup.PNGBook-Setup.PNG

  • Redbeard Profile Picture
    Redbeard 12,931 on 21 Nov 2017 at 14:00:12
    RE: Straight Line Depreciation not calculating correctly

    Bari -

    Since your Averaging Convention is set to Full Month, Dynamics GP calculates depreciation for the full month in the first period the asset is placed in service; April 30, 2017.  The remaining life of 4 years, 121 days confirms this.  April (full month) to November 30, 2017 is 244 days.  Depending on whether you've selected a Daily or periodic calculation methodology, you should see either $5,562.37 or $5,547.17 respectively.  Your post did not include the depreciated to date, but based on your remaining life, it would be November 30, 2017.  I surmise you're using the periodic methodology, as your original number for 2017 depreciation was $6240.56, which is 9 times a periodic rate, and not 275 times a daily rate.  

    The $2080.18 figure is representative of 3 months (periodic rate) depreciation, which would equate to Dynamics GP depreciating a full 12 months in 2017, if this is what it is booking for December?  At this point, you'll have to provide screen shots of all related Asset/Book settings to even entertain getting to the bottom of this.  One of your settings appears to be prompting Dynamics GP to take a full year of depreciation, in the first year, in much the same way one of your settings prompted Dynamics GP to take a full month of depreciation in the first month.

    In order to include screen shots in your post, you must "Use rich formating", which is a hyperlink at the bottom of each post box.  You'll need to use a clipping tool to take screen shots and then save them and upload them, so you can attach them in the post.

  • Community Member Profile Picture
    Community Member Microsoft Employee on 20 Nov 2017 at 17:45:28
    RE: Straight Line Depreciation not calculating correctly

    Depreciation Method: Straight-Line Orig Life

    Averaging Convention: Full Month

    Switchover: No Switch

    Place in Service Date: 4/30/17 (Depr. Begin Date 3/31/2017 Date added: 11/14/2017)

    Depreciated to Date: 11/30/2017

    Original Life in Year, Days: 5 years, 000 days

    Remaining year, Days: 4 years, 121 days

    Cost Basis: $41603.75

    Begin Year Cost: 41603.75

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