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Depreciation Keys?
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Answer Posted / geevidhyadhar
Depreciation is the process of expensing out your asset
(owing to various reasons such as wear and tear, change in
fashion/technology, unforeseen calamities etc.).
Depreciation normally occuring uses some standard and
acceptable methodologies. SAP defines such methodologies
such as depreciation methods ( Base method, declining
balance method, max.value method, period control method and
multilevel method which is a mixed bag of the other methods
described above). A Depreciation key can be considered as a
box which houses all the depreciation methods described
above. A suitable depreciation key and the estimated useful
life of the asset usually work together in finding out how
to expense out the value of asset ( viz. depreciate the
asset). When applied , the asset value keeps decreasing over
its estimated useful life in accordance with the norms
specified in the depreciation key whereby the asset value is
usually reduced to NIL when the useful life of the asset ends.
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