Difference Between Amortized and Expensed Adjustments in Oracle Assets - Oracle E-Business Suite Support Blog
Difference Between Amortized and Expensed Adjustments in Oracle Assets - Oracle E-Business Suite Support Blog
Difference Between Amortized and Expensed Adjustments in Oracle Assets - Oracle E-Business Suite Support Blog
January 5, 2017
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1/23/2020 Difference Between Amortized and Expensed Adjustments in Oracle Assets | Oracle E-Business Suite Support Blog
If you want the adjustment to be effective from a specific period and not from the
DPIS, the transaction needs to be an Amortized Adjustment. For amortized
adjustments, the effect of the adjustment will be from the period in which the
amortization start date falls and the accumulated depreciation prior to the
amortization start date will not be re-validated. When an amortized adjustment is
performed, Oracle Assets spreads the adjustment amount over the remaining life
or remaining capacity of the asset.
The depreciation, with an asset life of 12 months, would be 12000 / 12 = 1000 per
month.
The depreciation, with an asset life of 15 months, would be 12000 / 15 = 800 per
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month.
Until the Aug-16 period, the asset was depreciating based on a life of 12 months.
The existing depreciation reserve of the asset is 1000 * 7 months = 7000.
Based on the new life, the accumulated depreciation should be 800 * 7 months =
5600.
The depreciation catch-up in Aug-16 is 7000 - 5600 = (1400).
From the Aug-16 period onwards, the monthly depreciation for the asset will 800.
The depreciation, with an asset life of 12 months, would be 12000 / 12 = 1000 per
month.
The depreciation reserve amount charged up to Aug-16 is 1000 * 7 months =
7000.
So, the net book value of the asset as of Aug-16 is 12000 - 7000 = 5000.
The remaining life of the asset as of the Aug-16 period is: Total life – life already
completed = 15 months – 7 months = 8 months.
From the Aug-16 period onwards, the monthly depreciation for the asset will be
Net Book Value / Remaining Life = 5000 / 8 months = 625.
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