Configure and Manage Depreciation
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How to Configure and Manage Depreciation in Logic ERP?
This tutorial explains how to configure Fixed Assets and Depreciation Calculation in Logic ERP. It covers Account setup, Asset configuration, Depreciation methods, Journal Entry posting, and generating the Depreciation Schedule Report for accurate financial tracking.
Access Setup New Account Window
Depreciation Account Creation
Go to Main Menu and then Setup Module open Setup New Account.
Define Depreciation Account Name
Account Type: Expenses
Save the Account
Fixed Asset Account Creation
Create another Account for Fixed Assets
Account Type: Fixed Assets
Configure Asset Details
Open Other Details Window
Define Asset Information
Original Cost of Asset
Purchase Date of Asset
Additions to Date (If Any)
Additional value added to the Asset over time.
Deductions to Date
Value of Asset sold, removed, or disposed
Depreciation Amount to Date
Total depreciation charged till date
Define Depreciation Percentage
Annual depreciation rate of the Asset
Depreciation Percent After Midyear
Used when Asset is purchased during the financial year
Depreciation Percentage as per Company Act
Based on Asset useful life
Select Depreciation Calculation Method
Half Year for Additions after Mid Year
Fully Year for all Additions
From Purchase Date (Current Year Additions)
Note: In this tutorial, we will proceed with the "Full Year for all Additions" option.
Select Depreciation Mode
Diminishing Value Method (WDV)
Remaining Asset Value every year
Straight-Line Method (SLM)
Fixed Depreciation amount charged every year
Note: In this tutorial, we will proceed with the "Straight Line" method.
Define Useful Days
Useful Days represent total expected usage period of the Asset
Save the Account after completing all details
Pass Depreciation Journal Entry
Go to Main Menu and then Accounts Module open Journal Voucher Normal Entry
Pass the Depreciation Journal Entry.
Save the Voucher.
Generate Depreciation Report
Go to Main Menu and then Reports/Queries.
Select Balance Sheet Reports Open Depreciation Schedule Report.
Select Plant & Machinery Account from Filter Tree.
Define As On Date
As On Date:
31st March 2026
Note: 01-04-2025 is the date we defined while creating the Fixed Asset Account.
Result
Applicable calculation period becomes:
365 Days
Understand Depreciation Calculation
System Calculation
The software automatically calculates:
Original Cost
Net Value after Depreciation
Month-wise Depreciation
Depreciation Formula Used.
Since:
Original Asset Value = ₹1,00,000.
Useful Days = 1,095 Days (3 Years).
Applicable Days = 365 Days.
The software calculates depreciation using:
Depreciation = 365/1095x100000.
Calculated Result
Approximate Depreciation:
₹33,333.
Month-Wise Distribution
The software automatically distributes yearly depreciation:
Based on exact number of days in each month.
The formula used to apply this is:
Total Dep During the Year x No of Days in Month / Total Days in Year.
Ensures:
Accurate month-wise depreciation calculation.
Key Benefits
Automated depreciation management.
Accurate asset valuation.
Flexible depreciation calculation methods.
Simplified financial reporting and compliance.
Best Practice Tips
Define correct Useful Days and Purchase Dates.
Regularly update additions and deductions.
Choose the appropriate depreciation method as per accounting standards.
Final Outcome
Fixed Assets and Depreciation are configured successfully.
Accurate depreciation calculations generated automatically.
Month-wise and yearly depreciation tracking available.
Improved financial reporting and asset management in Logic ERP.
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