Depreciation up to salvage value

Finance and Operations/AX User Forum
1

Hi,

I want to calculate depreciation on book value but restricted up to salvage value.

For example, book value is 1,00,000. Depreciation % is 20 % and salvage value is 5%.

So depreciation value should come 20,000.

For 4 years asset should be depreciated for 80,000.

in the last year it should be 15,000 only and book value of asset should be 5,000 only till we sale the same.

I am using AX. Can anyone please help me how to set this up in to system.?

Thanks,

Jainal

2

Hi Jainal,

You can use Capitalization threshold in this case. This setup is done on FA group.

Capitalization threshold determines the minimum value that the FA within that group will be depreciated.

Default Capitalization threshold can be setup in FA parameter too.

Pranav…

3

Thanks a lot Pranav,

isnt is possible to insert % values instead of numbers.

Thanks,

Jainal

4

Hi Jainal,

In the standard AX, you can only specify amount and not percentage. That feature may be there in indian localization. Haven’t checked there.

Pranav…

5

Hi Pranav,

I have entered amount in Salvage value.

System is calculating depreciation on the value after deducting salvage value. Means if book value is 1,00,000. salvage value entered is 5,000.

Then system is calculating depreciation at 20 % on 95,000. [1,00,000 less 5,000] comes to 19,000 per year.

whereas my requirement is system should calculate depreciation on basis Book value which comes to 20,000 per year. [ 1,00,000 * 20% ]

and should post 15,000 only in 5th year keeping salvage value of 5,000 till i discard the asset.!!

Can you please help me how to use that salvage value field or need to go for some work around.!

Thanks,

Jainal