Manual depreciation

This article gives an overview of the manual depreciation method.

When you set up a fixed asset depreciation profile and select Manual in the Method field on the Depreciation profiles page, the depreciation of fixed assets that are assigned to the depreciation profile is determined by the percentage that you enter for each interval in the calendar year. The intervals that you set up percentages for are posted according to the value that you select in the Period frequency field on the General FastTab of the Depreciation profiles page. Here are the values that you can select:

  • Yearly
  • Monthly
  • Quarterly
  • Half-Yearly
  • Daily

After you select the period frequency, click Manual schedules, and set up percentages for each posting interval. Together, the manual schedules and the posting intervals define the depreciation amount, as shown in the examples later in this article. Manual depreciation is always calculated as a percentage of the acquisition price. For manual depreciation, the percentages that you enter in the intervals of the depreciation don't have to add up to 100 percent. Manual depreciation is a flexible depreciation method that is often used to define an extraordinary depreciation profile on the Books page, such as a non-periodic depreciation for special purposes (for example, tax).

Examples

Acquisition price: 11,000.00 Expected scrap value: 1,000.00 The following table shows the intervals and percentages that you set up on the Fixed asset depreciation profile schedules page.

Interval number Percentage
1 10.00
2 50.00
3 8.00

The following table shows how the depreciation for each interval is calculated.

Interval number Calculation of the yearly depreciation amount Net book value at the end of the interval
1 (11,000 – 1,000) × 10% = 1,000 10,000 (11,000 – 1,000)
2 (11,000 – 1,000) × 50% = 5,000 5,000 (10,000 – 5,000)
3 (11,000 – 1,000) × 8% = 800 4,200 (5,000 – 800)

If you select Monthly in the Period frequency field, you set up 12 manual schedule intervals. The following table shows the depreciation amounts for the first two intervals.

Interval Depreciation amount
January (11,000 – 1,000) × 10% = 1,000
February (11,000 – 1,000) × 50% = 5,000

If you select Half-Yearly in the *Period frequency* field, you set up two manual schedule intervals. The following table shows the depreciation amounts for those two intervals.

Interval Depreciation amount
June 30 (11,000 – 1,000) × 10% = 1,000
December 31 (11,000 – 1,000) × 50% = 5,000

The total of percentages for all intervals doesn't have to be 100. However, you receive a message if the value in the Cumulative percentage field on the Fixed asset depreciation profile schedules page isn't 100.