Understanding periodic depreciation and book value calculations - HxGN EAM - 12.0.1 - Help - Hexagon

HxGN EAM Help

Language
English
Product
HxGN EAM
Search by Category
Help
HxGN EAM Version
12.0.1

Depreciation expenses are calculated based on a depreciation period, a generic term that refers to an organization’s fiscal years or calendar month. Select to view depreciation expenses based on the depreciation period you prefer.

See Viewing depreciation details.

To calculate an asset’s periodic depreciation expense and book value, the daily depreciation expense of the asset must be calculated first.

See Understanding depreciation methods and daily calculations.

The number of days in the period must also be calculated before calculating an asset’s periodic depreciation expense or book value.

When calculating the number of days in a period, the first and final day are included in the tally. For example, the time between July 1, 2004 and July 2, 2004 is counted as 2 days.

For most periods of an asset’s life, the number of days in the period equals the number of days in the calendar month or fiscal year defined for your organization. For example, if you view depreciation expenses based on calendar month, the number of days in the period is 30 or 31. If you view depreciation expenses based on fiscal year and the fiscal year for your organization contains 365 days, the number of days in the period is 365.

The number of days falling in the first and last period of an asset’s life, however, usually does not equal a full 365, 30, or 31 days. The number of days in the first period are calculated based on the following equation:

  • Number of Days in First Period = Number of Days Between Commission Date and Period End Date

The number of days in the last period are calculated based on one of the following equations:

  • Number of Days in Last Period = Number of Days Between Period Start Date and Sold/Scrap Date

  • Number of Days in Last Period = Number of Days Between Period Start Date and the Asset’s End of Life Date

Once the number of days in each period is calculated, the asset’s depreciation expense and book values can be calculated. See the sections below for examples.