How To Reverse Half-Month Of Depreciation Taken During Retirement

(Doc ID 858762.1)

Last updated on JULY 18, 2016

Applies to:

Oracle Assets - Version 11.5.10.0 to 12.1.3 [Release 11.5 to 12.1]
Information in this document applies to any platform.
***Checked for Relevance 23-May-2011***


Goal

Example:

A new depreciation method using mid-quarter and 24 periods was setup.  A new tax book was created with 24 prorate periods and 12 depreciation periods, as per <Note 315385.1>: Mid Quarter Retirements Not Taking Correct Amount of Depreciation.

Mass copy was run and the retirement of an asset was copied to the new tax book.  In this example, the retirement date was 6/22/09.  The asset had a cost of $2000 with an in-service date of 7/8/05.

At the end of May, the depreciation reserve was $1726.95.  This amount was not the desired amount.

Year 2005 (2000 * .15) = 300
Year 2006 (2000 * .34) = 680
Year 2007 (2000 * .2040) = 408
Year 2008 (2000 * .1224) = 244.8

Total Accumulated Depreciation as of the end of 2008 = 1632.8

Depreciation in the year of retirement:
2000 * .1130 = 226 annually:  226 * .375 = 84.75 (rate based on quarter of disposal, i.e. 0.25 for JAN-MAR plus 0.125 for APR-JUN)

Total Depreciation:  1632.8 + 84.75 = 1717.55

Depreciation at the end of May = 1726.95

Amount to be reversed should be 1717.55 - 1726.95 = -9.41, NOT -18.83.

 

How can a half-month reversal (-9.41) be achieved, instead of a full month reversal (-18.83) that was taken?

Solution

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