Chapter 2 – Asset Maintenance

Asset Type is used to maintain the type of asset, the depreciation method, posting method, and depreciation accounts.

Examples of asset types include furniture, fittings, motor vehicles, and office equipment.

1. Go to Asset Register > Asset Type Maintenance.

2. Click  button to create new asset type.

Code: Asset Type Code is automatically assigned by system.

Short Code: Enter a short code for the asset type to add in the asset’s code..

Next No.: Next running number.

Description: Description of fixed asset type.

Depreciation on Method: 3 types of depreciation method to select from.

(i) Straight Line: Estimates the asset’s salvage value at the end of its useful life and expenses a portion of the original cost in equal increments over              that period.

    Annual depreciation expense = (cost of fixed asset – residual value)/ useful life of asset years.

(ii) Reducing Balance:  Provide for a higher depreciaiton charge in the first year of an asset’s life and gradually decreasing charges in subsequent                     years.

      Annual depreciation = Depreciaiton Rate * Book Value at beginning of year.

(iii) None:Do not capitalize this asset.

Salvage/Residual Value: The minimum value of a fixed asset after depreciation is RM 1.

Calculate By: Choose either by Year or Rate.

Calculate by Year, example: 5 years with each year depreciate 20%.

Calculate by Rate, example: Depreciate 5% for 20 years.

Account Code:

Asset Acct Code: Asset account in G/L.

Accum. Deprn Acct Code: Accumulated depreciation account in G/L.

Depreciation Acct Code: Depreciation account in G/L.

Asset Write Off Acct Code: You may need a write-off account for your spoiled or unused fixed assets.