Fixed asset Depreciation calculation

siva
siva Registered Posts: 54 Epic contributor ๐Ÿ˜
Hi Guys,

Can somebody help me, I am trying to do t he depreciation for june, as my manager has left work due to some problems i am asked if i will be able to do it, i havent got the register workings but have the values so i amm not sure how she has done the monthly depreciation values.

Its 5 years straight line so i would assume that if cost is ยฃ5000, depreciation charge will be ยฃ1000 every year divided /12 for each month. but she has diffrent figures every month how is that possible.

just want to know why the monthly depreciation charge diffs every month while it is straight line.

Thanks.

Comments

  • BeccaLouJ9
    BeccaLouJ9 Registered Posts: 896 Epic contributor ๐Ÿ˜
    Have there been disposals or additions in the year(s)?

    If not then I don't see why it would be diff if it is straight line...

    B x

    P.s. I have pm'd you
  • siva
    siva Registered Posts: 54 Epic contributor ๐Ÿ˜
    HI Becca,

    Its individual assets and depreciation differs every month for each and every individual asset.

    I can understand if there was any changes in the total depreciation, but each line differs every month by few pounds less sometimes more sometimes.

    I am breaking my head.
  • PGM
    PGM Registered Posts: 1,954 Beyond epic contributor ๐Ÿง™โ€โ™‚๏ธ
    Is it worked out on days instead of months? That would explain slight variations.

    I'd say either wait or use your best guess if its urgent!
  • siva
    siva Registered Posts: 54 Epic contributor ๐Ÿ˜
    I tried to do it by day, then we should have same figures for mar and may as they are 31 days, but no they are different. oh well i am jsut gonna do it as cost/15 months and then/12 months for now, let see.

    Thanks PGM.
  • MarkT
    MarkT Registered Posts: 302
    Would you not have one principle on depreciation for things such as cars and a different principle for smaller items such as computers?

    I could understand large machinery and vehicles perhaps running on a 5 year, but not computers and small office equipment?
  • siva
    siva Registered Posts: 54 Epic contributor ๐Ÿ˜
    yes we do, Computer and small equipments are 3 years. plant and machinery 5 years and property 15 years.
  • MarkT
    MarkT Registered Posts: 302
    Maybe I'm being a bit on the green side here, but could that not account for the difference?
  • Bluewednesday
    Bluewednesday Registered Posts: 1,624 Beyond epic contributor ๐Ÿง™โ€โ™‚๏ธ
    I think Siva is saying that each asset has different amounts in each month, rather than each class
  • wbauk2002
    wbauk2002 Registered Posts: 110 Beyond epic contributor ๐Ÿง™โ€โ™‚๏ธ
    Could it be some are straight line, and others are reducing balance?
  • sdv
    sdv Registered Posts: 585 Epic contributor ๐Ÿ˜
    siva wrote: ยป
    HI Becca,

    Its individual assets and depreciation differs every month for each and every individual asset.

    I can understand if there was any changes in the total depreciation, but each line differs every month by few pounds less sometimes more sometimes.

    I am breaking my head.

    Why don't you look at last year's actual accounts and concentrate on one class of assets. Work backwards and confirm that your company's depreciation policy has been applied. If not then the policy is different in which case you will have to go back a further one year back and confirm the policy applied is consistent on both year's figures. you will have to do some working.

    alternatively ring your company's accountant (auditors) and ask them what is the depreciation policy applied? This information should be in the final approved accounts of previous years.

    Forget what your predecessor did and start to apply the company's correct depreciation policy.
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