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Jan 12, 2011 at 12:43 PM

Calculation of Depreciation based on Remianing Useful Life

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Hi

I have a scenario in which depreciation percentage should be derived based on remaining useful life and it should remain same through out the remaining useful life.

For eg,

Take over date = 30.11.2010

Acquisition Date= 01.04.2009

Acquisition Amount = INR 200000

Depreciation Till 30.11.2010 = 70000 INR

Net Book Value as of 30.11.2010 = INR 130000

Total Useful Life = 4 Years or 48 months

Expired Useful Life = 1 year 9 months or 21 months

Remaining useful life = 27 months

Required Depreciation Per Month = 130000/27=4815

Derived Percentage = 4815/130000*100=3.71%

I have created a Base Method for calculation for Depreciation with Depreciation Method as "% from Remaining Life calculated from Depreciation Conversion Date". In Multilevel methods, I have assigned the Base Method as 24, Net Book Value

and maintained the check box for Remaining useful life.

However, the system is not calculating the rate as expected.

Regards

Sanil Bhandari