Entering depreciation

Liz edodd at billiau.net
Sat Jan 4 18:17:25 EST 2014


On Sat, 04 Jan 2014 17:11:22 -0500
Mike or Penny Novack <stepbystepfarm at mtdata.com> wrote:

> 
> > I have two accounts - an Asset account for the car
> >and an Expense account for the depreciation.
> >The asset account initially contains the full value of the car.
> >Thereafter, every month I calculate the depreciation amount (this is
> >the most difficult part), and create a transaction something like
> >this:
> >
> >Monthly Honda Depreciation Expense:
> >       DEBIT   $100.00 Expenses:Auto:Depreciation-Expense
> >       CREDIT $100.00 Assets:Honda
> >  
> >
> But why every month? It is much more usual to enter adjustment 
> transactions (like depreciation) once a year.
>

When I buy something that has to have depreciation calculated, I
calculate it all at once - first to the end of the financial year, and
then for each year until write off date. I never worry about it again,
it appears automatically in each year's reports.

Liz


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