WorkBook

Depreciating Assets

Depreciation systematically reduces an asset's book value over its useful life. WorkBook supports four depreciation methods (defined on the asset group):

Method How it Works
Straight Line Equal monthly charge: Initial Value / Useful Life Months
Reducing Balance Fixed percentage of remaining book value each period
Double Declining Balance Double the straight-line rate applied to the declining balance
Sum of Years' Digits Decreasing fractions weighted by remaining useful life
Note: All depreciation calculations are performed at full decimal precision internally, but values are always truncated to 2 decimal places before being applied. Fixed asset values will never have a third decimal place or beyond.

Running Depreciation

Click the Depreciate assets toolbar icon.

Step 1: Select Assets to Depreciate

Depreciation wizard Step 1: selecting assets and depreciation date

The wizard shows all eligible assets (capitalized, not disposed, with remaining depreciation periods). All are pre-selected by default. You can deselect any assets you do not want to depreciate yet.

The depreciation runs up to the processing month selected in the top-right corner of the main page.

Step 2: Review and Confirm

Review the depreciation amounts and confirm.

WorkBook:
  • Calculates the depreciation charge for each missing period from the asset’s next depreciation date up to the target date
  • Creates a Depreciation operation for each period
  • Posts journal entries: Debit depreciation expense account, Credit accumulated depreciation account
  • Updates the asset’s accumulated depreciation, book value, and next depreciation date
Important: Depreciation is incremental. If an asset is due for 3 months of depreciation, running depreciation once will process all 3 months. Running it again will have no effect (the asset is already up to date).

Depreciation stops automatically when the asset reaches the end of its useful life (depreciations left reaches 0) or current book value of the asset reaches 0.

Depreciation Rules and Restrictions

For assets that use the Reducing Balance method, if the calculated depreciation expense truncates to 0.00, or if the calculated amount is greater than the asset's current book value, WorkBook depreciates the entire current book value instead so that the asset is fully depreciated.