Example of Splitting an Asset Item

In this example, asset item A is split into asset item B and asset item C.

Scenario

Asset item A was automatically created in the Equipment hub when someone entered an accounts payable voucher. Now you want to split the asset item A into two other asset items, asset item B and asset item C, and track them separately.

Description	Additional Notes
You do not track multiple companies in Deltek, or if you have multiple companies, all the asset items involved in the split belong to the same company.	If you do track multiple companies, asset items can only be split into other asset items within the same company.
You use organizations and you maintain separate balance sheets for each organization.	Organizations and their balance sheets options are set up in Settings > Organization.
Asset item A: Belongs to organization O-1. Has a $4,000 acquisition cost, and its asset account number is 156.00. Has had depreciation processed for it in accounting period 2. The total accumulated depreciation is $300. The accumulated depreciation account is 158.00. Has a salvage value of $500.	An asset item's organization is determined by looking at the organization at the lowest level of the work breakdown structure for the project that is associated with the asset item. (for example the task). The organization for a task is entered in the Organization field on the General tab of the Projects hub. The $4,000 acquisition cost and asset account 156.00 displays in a row in the Acquisition Cost grid on the GL Cost tab in the Equipment hub. Depreciation has been processed for asset item A in Asset Management > Depreciation Processing. The $300 of accumulated depreciation for the asset item is listed in the History grid on the History tab in Asset Management > Asset Review
You have one additional book set up for asset item A.	The additional book is set up on the Additional Books tab in the Equipment hub. It has $200 in additional costs.

Steps

To split asset item A into asset items B and C in accounting period 2:

Step	Description
1.	In the Equipment hub, you create asset item B and asset item C. You click New > Copy Current Equipment to create the receiving asset items for the split. You associate asset item B with a project that belongs to organization O-1. You associate asset item C with a project that belongs to organization O-2.
2.	In Asset Management > Transfer/Split Processing, you enter the following on the Transfer/Split Processing form, and then click Run on the toolbar to process the split: In the Asset field, select asset item A. In the Action field, select Split. Enter a transaction date in the Transaction Date field. In the Split To grid, add a row and select asset item B in the Equipment field. On the Account lookup in the Account field, select the asset account 156.00 that is listed for asset item A. In the Acquisition Cost Amount field, enter $3,000. In the Split To grid, add a row and select asset item C in the Equipment field. On the Account lookup in the Account field, select the asset account 156.00 that is listed for asset item A. In the Acquisition Cost Amount field, enter $1,000.

Results

Journal Entry Posting Logs

You can view and print the journal entry posting logs that were created for the split in Transaction Center > Posting Logs.

Two journal entry posting logs are created, one for your GL Book and one for your additional books, because you have additional books for the asset item and the asset item had accumulated depreciation. The posting log for your GL book shows the amounts that were moved and also the entries that were posted to your general ledger for your GL Book. The posting log for your additional books shows the amounts that were moved, but there are no postings to any general ledger accounts.

Journal entries for asset item A and C for your GL Book (the asset items are from different organizations):

Balance Sheet Account	Debit	Credit
Asset Account 156.00 for Organization O-2 (for the receiving asset item C)	$1,000
Asset Account 156.00 for Organization O-1 (for the source asset item A)		$1,000
Accumulated Depreciation Account 158.00 for Organization O-1 (for the source asset item A)	$75
Accumulated Depreciation Account 158.00 for Organization O-2 (for the receiving asset item C)		$75

These entries were created because asset item A and C were from different organizations. Asset item C received 25% of asset item A's cost ($4,000 x .25 = $1,000), so asset item C received 25% of asset item A's accumulated depreciation ($300 x .25 = $75).

Journal entries for asset item A and B for your GL Book (the asset items are from the same organization):

Balance Sheet Account	Debit	Credit
Asset Account 156.00 for Organization O-1 (for the receiving asset item B and the source asset item A)	$1,000	$1,000
Accumulated Depreciation Account 158.00 for Organization O-1 (for the source asset item A and the receiving asset item B)	$75	$75

Although journal entries were made, there was no change in the account balances because the two asset items were from the same organization.

Acquisition Costs

In the Acquisition Cost grid on the GL Cost tab in the Equipment hub, you see new rows added for the removal from the source asset item and the additions to the receiving asset items. The rows have Insert in the Type field, negative amounts for removed costs, positive amounts for added costs, and the Description field displays either Split to or Split from, the equipment number for the source or receiving asset item, and the journal entry posting sequence number for the split.

Salvage Value

The salvage value of $500 from source asset item A was moved to the receiving asset items, based on the percentage of the asset item cost that was allocated to each receiving asset item:

• For asset item B: The percentage of costs it received from asset A was 75% ($3,000/$4,000).
• For asset item B: The percentage of costs it received from asset A was 25% ($1,000/$4,000).

The receiving asset items received the following salvage value amounts from asset item A:

• Asset item B received $375 of salvage value (75% of asset A's salvage value of $500).
• Asset item C received $125 of salvage value (25% of asset A's salvage value of $500).

You see the salvage values updated for each asset item in the Less Salvage Value field on the GL Cost tab in the Equipment hub.

Accumulated Depreciation

The accumulated depreciation amount for the source and receiving asset items has been updated. You see the updated amounts on the History tab in Asset Management > Asset Review.

Disposal

Because the split left asset item A with no remaining costs, asset item A's status in the Asset Status field on the GL Book tab in the Equipment hub changes automatically from Active to Disposed.