Using Fixed Assets modules in Dynamics GP – Straight Line Depreciation

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The following formula is used in Microsoft Dynamics GP for depreciating Fixed Asset using straight line method.

Formula: (Cost – Salvage Value – (LTD Depreciation Amount – YTD Depreciation Amount)) ÷ Remaining Life in Days. 

Where: 

Cost = Cost of Asset
Salvage Value = Estimated realizable value of an asset at the end of its life
LTD Depreciation = Life to date depreciation
YTD Depreciation = Year to date depreciation

With the above formula GP determines the daily depreciation rate which is then multiplied by the number of days in a year

If the Average method is “None” Dynamics GP will calculate depreciation as follows:

For example: 
Asset Cost: $ 200,000
Asset Life: 10 years

Depreciation: 
Daily Depreciation = 200,000/(360*10) = $ 55.55
Monthly Deprecation = 200,000/((360*10))*30 = $ 1,666.67

Written by Aamir Sakrani

Aamir Sakrani

Aamir Sakrani (MBA, CMA (AP), MCTS) is a Financial Business Analyst at AccSoft Business Solutions Inc. He is currently living in Toronto, Ontario.

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