The following formula is used in Microsoft Dynamics GP for depreciating Fixed Asset using straight line method.
Formula: (Cost – Salvage Value – (LTD Depreciation Amount – YTD Depreciation Amount)) ÷ Remaining Life in Days.
Cost = Cost of Asset
Salvage Value = Estimated realizable value of an asset at the end of its life
LTD Depreciation = Life to date depreciation
YTD Depreciation = Year to date depreciation
With the above formula GP determines the daily depreciation rate which is then multiplied by the number of days in a year
If the Average method is “None” Dynamics GP will calculate depreciation as follows:
Asset Cost: $ 200,000
Asset Life: 10 years
Daily Depreciation = 200,000/(360*10) = $ 55.55
Monthly Deprecation = 200,000/((360*10))*30 = $ 1,666.67
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