Depreciation of the Declining Balance Method

c06bb22e-eec8-4205-a3d8-228bdfad22c1

Depreciation signifies wastage or loss of the usage capacity (useful life) of tangible or physical assets by usage, natural causes or by technological obsolescence.

Generally, the depreciation is made by usage because, for obsolesce or nature's action, a Technical Report issued by competent authorities is required.

The depreciation is calculated by the expansion of the depreciation rate, established based on the estimate useful life of the item, over the amount of assets subject to the depreciation.

Depreciation generates an expense (administrative area) or cost (production area). It starts being calculated only from the moment it was started to be used.

Some assets do not lose value, such as: lots of land, works of art, etc., which means there is no depreciation for these assets.

The system performs the calculation based on the annual depreciation rate informed to each asset, until the accumulated depreciation value is equivalent to the acquisition value in hard currency, which represents the total asset depreciation.

Besides admin-IN-316fd0ae-5f3c-4db9-ac26-cbdf4ff8a7d1-1507579308097-c85d75ac-b7a0-4d1c-af9f-19486f5c784d, the system enables the user to do the following: