How to calculate depreciation of fixed assets

Property accepted for accounting at the enterprise is subject to depreciation. The exception is non-depreciable property, which includes natural resources, construction in progress, working capital, etc. There are several ways to calculate depreciation. At the heart of each of them is the useful life of the facilities.

Instruction manual

1

Useful lives are determined in accordance with the classification of property, plant and equipment. In it, all the property is divided into 10 groups. Each of them has its own useful life, i.e. the period during which the property is capable of generating income for the enterprise and serving its business objectives.

2

Depreciation can be calculated linearly. In this case, its annual amount is determined based on the initial cost of the fixed assets and depreciation rates calculated on the basis of useful life. Suppose an organization acquired an item of fixed assets worth 100, 000 rubles. Its useful life is 5 years, which means a depreciation rate of 20%. Therefore, the annual depreciation amount will be 20, 000 rubles. (100, 000 * 20%).

3

When calculating depreciation using the reduced balance method, its annual amount is determined based on the residual value of the fixed assets at the beginning of the reporting period, the depreciation rate and the acceleration coefficient. The latter is established by law for each type of property. For example, an enterprise acquired equipment worth 100, 000 rubles. Useful life of 5 years. The depreciation rate is 20%, but it will be increased to 40%, since the acceleration coefficient is 2. Therefore, in the first year of operation of the equipment, depreciation will be 40, 000 rubles. In the second year, it will be 40% of the residual, i.e. 24 000 rub. (60, 000 * 40%), etc.

4

Another way to calculate depreciation is by the number of years of useful life. In this case, the depreciation amount for the year is determined based on the initial value of the property and the ratio, the numerator of which will be the number of years remaining until the end of the operation of the object, and the denominator is the sum of the number of years. For example, an enterprise acquired property worth 100, 000 rubles. Its useful life is 5 years. The sum of the numbers of years will be 15 (5 + 4 + 3 + 2 + 1). Accordingly, for the first year depreciation will amount to 33, 333.33 rubles. (100, 000 * 5/15), in the second year 26, 666.67 rubles. (100, 000 * 4/15), etc.

5

With the method of calculating depreciation in proportion to the volume of manufactured products, accrual is carried out on the basis of natural indicators and the ratio of the estimated volume of manufactured products over their useful lives. For example, an enterprise acquired a car worth 200, 000 rubles. Estimated mileage over the entire useful life of 500 thousand km. For the first year, the car drove 10 thousand km. Consequently, the annual depreciation amount will be 4, 000 rubles. (10/500 * 200, 000).