Cost Adjustments to Assets Using a Diminishing Value Depreciation Method
Example: You place an asset in service in Year 1, Quarter 1. The recoverable cost is $4,000. You are using a 20% flat-rate that you apply to the beginning of year net book value. The bonus rate is 10%. In Year 2, Quarter 1, you change the recoverable cost to $4,800.
| Asset Clearing
| 800.00
|
|
| Accounts Payable Liability
|
| 800.00
|
| Asset Cost
| 800.00
|
|
| Asset Clearing
|
| 800.00
|
Expensed
| Depreciation Expense
| 168.00
|
|
| Bonus Expense
| 84.00
|
|
| Depreciation Expense (adjustment)
| 160.00
|
|
| Bonus Expense (adjustment)
| 80.00
|
|
| Accumulated Depreciation
|
| 328.00
|
| Bonus Reserve
|
| 164.00
|
Amortized
| Depreciation Expense
| 180.00
|
|
| Bonus Expense
| 90.00
|
|
| Accumulated Depreciation
|
| 180.00
|
| Bonus Reserve
|
| 90.00
|
