6.3 Asset Deprecation Flashcards

1
Q

Describe depreciation schedules

A

reduce the value of an asset according to user-defined period thresholds

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2
Q

Benefit of depreciation schedules

A

provide a more accurate view of an asset’s current value

provide more information towards decision-making regarding an asset’s lifecycle

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3
Q

List the types of depreciation schedules

A
  • Straight line (SL)
  • Double declining (DDB)
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4
Q

Describe the straight line (SL) depreciation schedule

A

the expense is an equal amount each period

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5
Q

Describe the double declining (DDB) depreciation schedule

A

the expense is a percentage of the item’s cost

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6
Q

Describe what happens when a depreciation schedule is added to an asset

A

A depreciation expense is periodically allocated to the cost of an asset’s original purchase value.

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7
Q

How is rate determined?

A

user-defined period threshold

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8
Q

Types of period thresholds

A
  • Date-based
  • Usage-based
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9
Q

Describe date-based period threshold

A

can be calculated monthly, quarterly, semi-yearly, or yearly

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10
Q

Describe usage-based period threshold

A

can be calculated based on meter life-to-date intervals

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11
Q

How is a depreciation schedule added to an asset?

A

by using the depreciation related actions in the More Actions menu from the Asset application or by applying an asset template that contains a depreciation schedule.

It can also be inherited from rotating items during the receiving or invoicing process.

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12
Q

How can an asset’s depreciation schedule be modified?

A

After an asset has a depreciation schedule, it can be adjusted by using the Manage Depreciation Schedule dialog box, or it can be swapped with another asset in the Swap Depreciation Schedule dialog box.

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