(RUS) Linear and non-linear depreciation methods [AX 2012]

Updated: November 21, 2012

Applies To: Microsoft Dynamics AX 2012 R3, Microsoft Dynamics AX 2012 R2

The linear depreciation method is the simplest and the most widely used method to calculate the depreciation for fixed assets. The capital allowance is recorded by equal portions for every time period or interval for the entire service life of the fixed asset.

For example, the cost of a computer is RUB 10,000, and its established service life, when functional and physical deterioration are considered, is five years. Each year, 10,000/5 is written off, which equals RUB 2,000 of depreciation. Therefore, you can calculate depreciation for a computer by using the linear method.

In the non-linear method, the accrued amount per month for the depreciation asset is defined as the product of the remaining value of the object and the depreciation rate. The depreciation rate is defined by the formula K = (2/n) * 100%, where n = the useful life of the object in months, as in the reducing balance method.

In addition, when the residual value of the object reaches 20 percent of its original value, the residual value is used as the base value for additional depreciation calculations for the object. The monthly depreciation amount is defined by dividing the base cost of the object by the number of months that remain until the end of its service life.

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