Answer / rajesh

When an asset is purchased and used in our organisation,
due to wear and tear the life the asset is decrease. This
is called depreciation.

When depreciation is configured in SAP we will run for
every month to calculate the depreciation and the
depreciation value is deducted from asset

For Ex: Asset Dep = Cost of asset - Scrap value / Life of
asset

If an asset is purchased for 10000 and the life is 10 yrs
after end of life the scrap value is 0 the the depreciation
per annum = 10000-0/10 = 1000

If it is worng send response immediately

Answer / m

A continuation to the explaination provided above

The assets are on the balance sheet and so when they fall in
value, that's an expense for the company - the 1,000/yr in
the example above.

The asset depreciation run will generate an accounting
transaction to lower the value of assets as maintained in
the asset account and charge that to an asset depreciation
account - en expense. Even though no cash flow is involved,
this transaction lowers the profit (incr loss) of the business.

Answer / anant maheshwari

A continuation to the explaination provided above

There are two parameters to depericiate the assets on the
basis of Straight Line Method / Written Down Method
Generally Used in Company.

You have to define Key in SAP, so system pick the
parameters accordingly and when we run depericiation with
AFAB It will cal. the figure accordingly.

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