How to calculate the depreciation of fixed assets

The main funds of the enterprise throughout the entire service life are subjected to wear, which ultimately leads to their full damage and unsuitability. In this regard, in order not to incur losses due to the failure of fixed assets, the company applies in the accounting records of depreciation deductions, which accumulate at the enterprise's current account for financing capital investments in new fixed assets.

The sum of all depreciation deductions in a separate form of fixed assets should be equal to the initial cost. Based on this rule, methods of calculating depreciation, which apply to various groups of fixed assets, and also have its advantages and disadvantages:

rectilinear method;
method of reducing residual value;
the method of accelerated reduction of residual value;
cumulative method;
production method.

The easiest way to calculate depreciation is the use of a rectilinear method. It is easy thanks to a simple formula, all deductions are written off monthly equal parts over the entire usefulness. However, it does not take into account the moral depreciation of fixed assets, i.e. There are no deductions for modernization. Sequencing:

calculate the amortized value, which is equal to the difference between the initial and liquidation cost;
divide the depreciable cost for useful uses to obtain an annual amount of depreciation;
divide the annual depreciation amount for 12 months to determine the monthly depreciation deductions.

In the first years of the operation of fixed assets in the first years of mainstreaming the principal amount for their recovery, the method of reducing residual value is used.

calculate the annual rate of depreciation: find the ratio of liquidation value to the initial, remove the root from this number with the value of the degree equal to the useful life, take this result from the unit and multiply by 100% - this figure is calculated as a percentage;
to calculate the annual amount of depreciation at the beginning of the first year of operation, multiply the initial cost to the depreciation rate;
for calculations of the next anniversary - the residual value for the relevant rate of depreciation.

The method of accelerated reduction of residual value differs from the previous formula for calculating the depreciation rate and helps to accumulate more large amounts in a shorter time. Apply to machines and equipment, as well as to vehicles. The depreciation rate is equal to the double ratio of the depreciable value by the term of use.

The cumulative method also allows in the first years to accumulate a significant amount, because The amount of deductions are the largest in the first year, then these amounts are followed by descending. Sequence of calculations:

to find a cumulative coefficient, divide the number of years remaining until the end of the useful life is for a cumulative number;
the cumulative number is the sum of the numerical values \u200b\u200bof each year of use of the object, for example, use time - 4 years, cumulative number \u003d 1 + 2 + 3 + 4 \u003d 10;
annual depreciation deductions are equal to the product of the depreciable amount per cumulative coefficient.

The production method is applicable to those fixed assets whose physical wear is proportional to product produced. The production rate of depreciation is the ratio of depreciable value to the planned total product volume. According to this method, depreciation deductions are not determined by annual, but monthly. They are equal to the work of the actual volume of products produced and the production rate of depreciation.

Depreciation deductions are not made according to some types of fixed assets: on land and natural resources, because their consumer properties do not change over time; by fixed assets that were received free of charge (privatized or donated); By housing, with the exception of those objects that are used in commercial activities.