Catch up depreciaton posted for retired asset

Sep 19, 2023 5:10AM

Summary:

Why is catch-up depreciation calculated to the asset as Accumulated Depreciation?

Content (required):

Catch-up depreciation is calculated to the asset as Accumulated Depreciation. The depreciation and retirement convention is "acquisition month no depreciation retirement month fully depreciation" and monthly depreciation.

Entries are as follows;

Proceeds of Sale Clearing DR 12200

NBV Retired DR 11000

Accumulated Depreciation DR 1000

Accumulated Depreciation DR 1000 (Catch up depreciation)

Proceeds of Sale CR 12200

Cost CR 12000

Depreciation Expense CR 1000

Retirement month - Feb 2023

Asset Date in Place Service - Oct 2022

Retirement transaction - Jul-23

Jul-23 depreciation program is not run.

Version (include the version you are using, if applicable):

Catch up depreciaton posted for retired asset

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