Fixed Assets Accounting Entries

Fixed Assets Accounting Entries
Mass Additions Accounting Entries
Case 1: Current Period Addition
Example: The recoverable cost is $4,000 and method is straight-line 4 years. we purchase and
place asset into service in Year 1, Quarter 1.
Payables System - Current Period Addition
Dr. Asset Clearing 4,000

Cr. Accounts Payable Liability 4,000
Oracle Assets - Current Period Addition
Dr. Asset Cost 4,000.00

Dr. Depreciation Expense 250.00
Cr. Asset Clearing 4,000.00
Cr. Accumulated Depreciation 250.00
Case 2: Prior Period Addition
You place an asset in service in Year 1, Quarter 1, but we do not enter it into Oracle Assets until
Year 2, Quarter 2. The payables system creates same journal entries to asset clearing and
accounts payable liability as for a current period addition.
Payables System - Prior Period Addition
Dr. Asset Clearing 4,000

Oracle Assets Prior Period Addition

Dr. Depreciation Expense (Adjustment) 1,250.00
1
Cr. Accumulated Depreciation 1,500.00
Merge Mass Additions Accounting Entries
Oracle Assets creates journal entries for the asset cost account for the mass addition into which
the others were merged. Oracle Assets creates journal entries for each asset clearing account.
For example, we merge mass addition #1 into mass addition #2, so Oracle Assets creates journal
entries:
Payables System

(mass addition #2 asset cost account)
(mass addition #1 accounts payable
clearing account)
(mass addition #2 accounts payable
clearing account)
Construction-In-Process (CIP) Addition Accounting Entries
Oracle Assets
Dr. CIP Cost 4,000

Cr. CIP Clearing 4,000
Deleted Mass Additions no Accounting Entries
Oracle Assets creates no journal entries for deleted mass additions and does not clear the asset
clearing accounts credited by accounts payable. we clear the accounts by either reversing the
invoice in payables system, or creating manual journal entries in general ledger.
Capitalization Accounting Entries
2
A capitalization transaction is similar to an addition transaction: when we place the asset in
service so you can begin depreciating it. When we capitalize an asset in the period you added it,
Oracle Assets creates the following journal entries:
Payables System Accounting Entries
Dr. CIP Cost 4,000

Oracle Assets - CAPITALIZED IN PERIOD ADDED

Cr. CIP Clearing 4,000.00
When we capitalize an asset in a period after the period added it, Oracle Assets creates journal
entries that transfer the cost from CIP cost account to asset cost account.
Oracle Assets - CAPITALIZED After PERIOD ADDED

Cr. CIP Cost 4,000.00
Asset Type Adjustments Accounting Entries
If we change the asset type from capitalized to CIP, Oracle Assets creates journal
entries to debit the CIP cost account and credit the asset clearing account.
Oracle Assets does not create capitalization or reverse capitalization journal
entries for CIP reverse transactions. Oracle Assets Change Type from
CAPITALIZED TO CIP (CURRENT PERIOD)
Dr. CIP Cost 4,000

Cr. Asset Clearing 4,000
3
Journal Entries for Depreciation
When we run depreciation, Oracle Assets creates journal entries for accumulated depreciation
accounts and depreciation expense accounts.
Oracle Assets creates journal entries for a current period depreciation charge of $200 and a
bonus charge of $50:
Oracle Assets

Dr. Bonus Expense 50.00
Cr. Bonus Reserve 50.0
Journal Entries for Retirements
When you retire an asset and create journal entries for that period, Oracle Assets creates
journal entries for your general ledger for each component of the gain/loss amount. Oracle
Assets creates journal entries for either the gain or the loss accounts for the following
components: proceeds of sale, cost of removal, net book value retired, and revaluation reserve
retired. Oracle Assets also creates journal entries to clear the proceeds of sale and cost of
removal.
Oracle Assets creates journal entries for the retirement accounts you set up in the Book
Controls window. If you enter distinct gain and loss accounts for each component of the
gain/loss amount, Oracle Assets creates multiple journal entries for these accounts. You can
enter different sets of retirement accounts for retirements that result in a gain and retirements
that result in a loss.
Depreciation for Retirements Journal Entries
Case 1: Current Period Retirements Journal Entries
Example: when we place an asset in service in Year 1, Quarter 1. The asset cost is $4,000, the
life is 4 years, and when we are using straight-line depreciation. In Year 3, Quarter 3, we sell the
asset for $2,000. The cost to remove the asset is $500. The asset uses a retirement convention
and depreciation method which takes depreciation in the period of retirement. You retire
revaluation reserve in this book.
Receivables System
4
Dr. Accounts Receivable 2,000.00
Cr. Proceeds of Sale Clearing 2,000.00
Payables System
Dr. Cost of Removal Clearing 500.00
Cr. Accounts Payable 500.00
Oracle Assets - MULTIPLE GAIN/LOSS ACCOUNTS
5
Dr. Accumulated Depreciation 2,500.00
Dr. Proceeds of Sale Clearing 2,000.00
Dr. Cost of Removal Gain 500.00
Dr. Revaluation Reserve 600.00
Dr. Net Book Value Retired Gain 1,500.00
Cr. Asset Cost 4,000.00
Cr. Proceeds of Sale Gain 2,000.00
Cr. Cost of Removal Clearing 500.00
Cr. Revaluation Reserve Retired Gain 600.00
Case 2: If we enter the same account for each gain and loss account, Oracle Assets creates a
single journal entry for the net gain or loss as shown in the following table:
Book Controls window:
Accounts Gain Loss
Proceeds of Sale 1000 1000
Cost of Removal 1000 1000
Net Book Value Retired 1000 1000
Revaluation Reserve Retired 1000 1000
6
Oracle Assets - SINGLE GAIN/LOSS ACCOUNT
Cr. Gain/Loss 600.00
Case 3: Prior Period Retirement Journal Entries
Example: when we place an asset in service in Year 1, Quarter 1. The asset cost is $4,000, the
life is 4 years, and you are using straight-line depreciation. In Year 3, Quarter 3, you discover
that the asset was sold in Year 3, Quarter 1, for $2,000. The removal cost was $500. The asset
uses a retirement convention and depreciation method which allows to take depreciation in
the period of retirement.
Receivables System
Dr. Accounts Receivable 2,000.00
7
Payables System
Cr. Accounts Payable 500.00
Oracle Assets
Dr. Cost of Removal Loss 500.00
Dr. Net Book Value Retired Loss 1,750.00
Cr. Proceeds of Sale Loss 2,000.00
Cr. Depreciation Expense 250.00
Depreciation for Retirements Journal Entries
Case 1: Current Period Reinstatement Journal Entries
Example: You discover that you retired the wrong asset. Oracle Assets creates journal entries for
the reinstatement to debit asset cost, credit accumulated depreciation, and reverse the gain or
loss you recognized for the retirement. Oracle Assets reverses the journal entries for proceeds
of sale, cost of removal, net book value retired, and revaluation reserve retired. Oracle Assets
also reverses the journal entries you made to clear the proceeds of sale and cost of removal.
8
Oracle Assets also creates journal entries to recover the depreciation not charged to the
asset and for the current period depreciation expense.
Oracle Assets
Dr. Gain / Loss 600.00
Cr. Revaluation Reserve 600.00
Case 2: Prior Period Reinstatement Journal Entries
Example: You place an asset in service in Year 1, Quarter 1. The asset cost is $4,000,
the life is 4 years, and you are using straight-line depreciation. In Year 2, Quarter 1, you
retire the asset. In Year 2, Quarter 4, you realize that you retired the wrong asset so you
reinstate it.
Oracle Assets
Dr. Proceeds of Sale Loss 2,000.00

(adjustment)
9
Cr. Net Book Value Retired Loss 2,750.00
Cr. Cost of Removal Loss 500.00
Assets Fully Reserved Upon Addition Journal Entries
If you add an asset with an accumulated depreciation equal to the recoverable cost, it is fully
reserved upon addition. When you retire it, Oracle Assets does not back out any depreciation,
even if you assigned the asset a depreciation method that backs out all depreciation in the year
of retirement. However, it creates all the other journal entries associated with retiring a
capitalized asset.
Non-Depreciated Capitalized/Construction-In-Process (CIP) Assets no

Journal Entries
A non-depreciated capitalized asset or a CIP asset has no accumulated depreciation. Therefore,

Oracle Assets does not create journal entries to catch up depreciation to the retirement prorate
date, and does not remove the accumulated depreciation. However, Oracle Assets creates all
other journal entries associated with retiring a capitalized asset.
Reinstatement Transactions NO Journal Entries
PENDING Asset Retirement
When you reinstate an asset retired in the current accounting period that the calculate gains
and losses program has not yet processed, the retirement transaction is deleted, and the asset
is immediately reinstated. No journal entries are created.
10
PROCESSED Asset Retirement
When you reinstate an asset retired in a previous accounting period or already processed in the
current period, the existing retirement transaction gets a new Status REINSTATE, and the asset is
reinstated when you process retirements. Oracle Assets creates journal entries to catch up any
missed depreciation expense.
Revaluations Journal Entries
Case 1: Revalue Accumulated Depreciation
Example 1: You place an asset in service in Year 1, Quarter 1. The asset cost is $10,000, the life is
5 years, and you are using straight-line depreciation.
In Year 2, Quarter 1 you revalue the asset using a revaluation rate of 5%. Then in Year 4, Quarter
1 you revalue the asset again using a revaluation rate of -10%.
Revaluation Rules:
o Revalue Accumulated Depreciation = Yes
o Amortize Revaluation Reserve = No
o Retire Revaluation Reserve = No
Oracle Assets bases the new depreciation expense on the revalued remaining net book value.
In Year 5, Quarter 4, at the end of the asset's life, you retire the asset with no proceeds of sale
or cost of removal.
The effects of the revaluations are illustrated in the following table:
Period (Yr, Qtr.) Asset Cost Deprn. Expense Accum. Deprn. Reval. Reserve
Yr1,Q1 10,000.00 500.00 500.00 0.00
Yr1,Q2 10,000.00 500.00 1,000.00 0.00
Yr1,Q3 10,000.00 500.00 1,500.00 0.00
Yr1,Q4 10,000.00 500.00 2,000.00 0.00

11
Reval. 1 5% 10,500.00 0.00 *2,100.00 **400.00
Yr2,Q1 10,500.00 525.00 2,625.00 400.00
Yr2,Q2 10,500.00 525.00 3,150.00 400.00
Yr2,Q3 10,500.00 525.00 3,675.00 400.00
Yr2,Q4 10,500.00 525.00 4,200.00 400.00
Yr3,Q1 10,500.00 525.00 4,725.00 400.00
Yr3,Q2 10,500.00 525.00 5,250.00 400.00
Yr3,Q3 10,500.00 525.00 5,775.00 400.00
Yr3,Q4 10,500.00 525.00 6,300.00 400.00
Reval. 2 -10% 9,450.00 0.00 *5,670.00 **-20.00
Yr4,Q1 9,450.00 472.50 6,142.50 -20.00
Yr4,Q2 9,450.00 472.50 6,615.00 -20.00
Yr4,Q3 9,450.00 472.50 7,087.50 -20.00
Yr4,Q4 9,450.00 472.50 7,560.00 -20.00
12
Yr5,Q1 9,450.00 472.50 8,032.50 -20.00
Yr5,Q2 9,450.00 472.50 8,505.00 -20.00
Yr5,Q3 9,450.00 472.50 8,977.50 -20.00
Yr5,Q4 9,450.00 472.50 9,450.00 -20.00
Retire 0.00 0.00 0.00 -20.00
REVALUATION 1
Year 2, Quarter 1, 5% revaluation
*Accumulated Depreciation =
Existing Accumulated Depreciation +
[Existing Accumulated Depreciation x (Revaluation Rate / 100)]
2,000 + [2,000 X (5/100)] = 2,100
**Revaluation Reserve =
Existing Revaluation Reserve + Change in Net Book Value
0 + (8,400 - 8,000) = 400
Oracle Assets - REVALUATION
Dr. Asset Cost 500.00
Cr. Revaluation Reserve 400.00
REVALUATION 2
13
-10% revaluation in Year 4, Quarter 1:
Dr. Accumulated Depreciation 630.00
Retirement in Year 5, Quarter 4:
Case 2: Accumulated Depreciation Not Revalued
In Year 2, Quarter 1 you revalue the asset using a revaluation rate of 5%. Then in Year 4, Quarter
1 you revalue the asset again using a revaluation rate of -10%.
Revaluation Rules:
o Revalue Accumulated Depreciation = No
o Retire Revaluation Reserve = Yes
For the first revaluation, the asset's new revalued cost is $10,500. Since you do not revalue the
accumulated depreciation, Oracle Assets transfers the balance to the revaluation reserve in
addition to the change in cost.
14
Since you are also not amortizing the revaluation reserve, this amount remains in the
revaluation reserve account until you retire the asset, when Oracle Assets transfers it to the
appropriate revaluation reserve retired account. Oracle Assets bases the new depreciation
expense on the revalued net book value.
For the second revaluation, the asset's revalued cost is $9,450. Again, since you do not revalue
the accumulated depreciation, Oracle Assets transfers the balance to the revaluation reserve
along with the change in cost.
You retire the asset in Year 5, Quarter 4, with no proceeds of sale or cost of removal.
Yr1,Q1 10,000.00 500.00 500.00 0.00
Yr1,Q2 10,000.00 500.00 1,000.00 0.00
Yr1,Q3 10,000.00 500.00 1,500.00 0.00
Yr1,Q4 10,000.00 500.00 2,000.00 0.00
Reval. 1 5% 10,500.00 0.00 0.00 *2,500.00
Yr2,Q1 10,500.00 **656.25 6,56.25 2,500.00
Yr2,Q2 10,500.00 656.25 1,312.50 2,500.00
Yr2,Q3 10,500.00 656.25 1,968.75 2,500.00
Yr2,Q4 10,500.00 656.25 2,625.00 2,500.00
Yr3,Q1 10,500.00 656.25 3,281.25 2,500.00

15
Yr3,Q2 10,500.00 656.25 3,937.50 2,500.00
Yr3,Q3 10,500.00 656.25 4,593.75 2,500.00
Yr3,Q4 10,500.00 656.25 5,250.00 2,500.00
Reval. 2 -10% 9,450.00 0.00 0.00 *6,700.00
Yr4,Q1 9,450.00 **1,181.25 1,181.25 6,700.00
Yr4,Q2 9,450.00 1,181.25 2,362.50 6,700.00
Yr4,Q3 9,450.00 1,181.25 3,543.75 6,700.00
Yr4,Q4 9,450.00 1,181.25 4,725.00 6,700.00
Yr5,Q1 9,450.00 1,181.25 5,906.25 6,700.00
Yr5,Q2 9,450.00 1,181.25 7,087.50 6,700.00
Yr5,Q3 9,450.00 1,181.25 8,268.75 6,700.00
Yr5,Q4 9,450.00 1,181.25 9,450.00 6,700.00
REVALUATION 1 : 5% revaluation in Year 2, Quarter 1:

16
Cr. Revaluation Reserve 2,500.00
REVALUATION 2 : -10% revaluation in Year 4, Quarter 1:
Retirement in Year 5, Quarter 4:
Dr. Revaluation Reserve 6,700.00
Cr. Revaluation Reserve Retired Gain 6,700.00
Case 3: Amortizing Revaluation Reserve
17
In Year 2, Quarter 1 you revalue the asset using a rate of 5%. Then in Year 4, Quarter 1 you
revalue the asset again using a rate of -10%.
Revaluation Rules:
o Amortize Revaluation Reserve = Yes
For the first revaluation, the asset's new revalued cost is $10,500. Since you do not revalue the
accumulated depreciation, Oracle Assets transfers the entire amount to the revaluation reserve.
Since you are amortizing the revaluation reserve, Oracle Assets calculates the revaluation
amortization amount for each period using the asset's depreciation method. Oracle Assets also
bases the new depreciation expense on the revalued net book value.
For the second revaluation, the asset's revalued cost is $9,450. Again, since you do not revalue
the accumulated depreciation, Oracle Assets transfers the entire amount to the revaluation
reserve.
Period (Yr,Qtr.) Asset Cost Deprn. Expense Accum. Deprn. Reval. Amortize Reval. Reserve
Yr1,Q1 10,000.00 500.00 500.00 0.00 0.00
Yr1,Q2 10,000.00 500.00 1,000.00 0.00 0.00
Yr1,Q3 10,000.00 500.00 1,500.00 0.00 0.00
Yr1,Q4 10,000.00 500.00 2,000.00 0.00 0.00
Reval. 1 5% 10,500.00 0.00 0.00 0.00 *2,500.00
Yr2,Q1 10,500.00 **656.25 656.25 ***156.25 2,343.75

18
Yr2,Q2 10,500.00 656.25 1,312.50 156.25 2,187.50
Yr2,Q3 10,500.00 656.25 1,968.75 156.25 2,031.25
Yr2,Q4 10,500.00 656.25 2,625.00 156.25 1,875.00
Yr3,Q1 10,500.00 656.25 3,281.25 156.25 1,718.75
Yr3,Q2 10,500.00 656.25 3,937.50 156.25 1,562.50
Yr3,Q3 10,500.00 656.25 4,593.75 156.25 1,406.25
Yr3,Q4 10,500.00 656.25 5,250.00 156.25 1,250.00
Reval. 2 -10% 9,450.00 0.00 0.00 0.00 *5,450.00
Yr4,Q1 9,450.00 **1,181.25 1,181.25 ***681.25 4,768.75
Yr4,Q2 9,450.00 1,181.25 2,362.50 681.25 4,087.50
Yr4,Q3 9,450.00 1,181.25 3,543.75 681.25 3,406.25
Yr4,Q4 9,450.00 1,181.25 4,725.00 681.25 2,725.00
Yr5,Q1 9,450.00 1,181.25 5,906.25 681.25 2,043.75
Yr5,Q2 9,450.00 1,181.25 7,087.50 681.25 1,362.50
Yr5,Q3 9,450.00 1,181.25 8,268.75 681.25 681.25
Yr5,Q4 9,450.00 1,181.25 9,450.00 681.25 0.00
19
REVALUATION 1 : Year 2, quarter 1, 5% revaluation
Oracle Assets creates journal entries each period to amortize the revaluation reserve:
Cr. Revaluation Amortization 156.25
REVALUATION 2 : Year 4, quarter 1, -10% revaluation
Oracle Assets creates journal entries each period to amortize the revaluation Reserve
20
Case 4: Revaluation of a Fully Reserved Asset
5 years, and you are using straight-line depreciation. The asset's life extension factor is 2 and the
maximum fully reserved revaluations allowed for this book is 3.
In year 5, quarter 4 the asset is fully reserved. In Year 9, Quarter 1 you want to revalue the asset
with a revaluation rate of 5%.
Revaluation Rules:
First, Oracle Assets checks whether this fully reserved asset has been previously revalued as
fully reserved, and that the maximum number of times is not exceeded by this revaluation.
Since this asset has not been previously revalued as fully reserved, this revaluation is allowed.
The asset's new revalued cost is $10,500. The life extension factor for this asset is 2, so the
asset's new life is 2 X 5 years = 10 years. Oracle Assets calculates depreciation expense over its
new life of 10 years. Oracle Assets calculates the depreciation adjustment of $2,000 using the
new 10 year asset life. It transfers the change in net book value to the revaluation reserve
account.
Oracle Assets revalues the accumulated depreciation using the 5% revaluation rate. The change
in net book value is transferred to the revaluation reserve account. Since you do not amortize
the revaluation reserve, the amount remains in the revaluation reserve account.
The effect of the revaluation is illustrated in the following table:
21
Yr1 to Yr4
Yr5,Q1 10,000.00 500.00 8,500.00 0.00
Yr5,Q2 10,000.00 500.00 9,000.00 0.00
Yr5,Q3 10,000.00 500.00 9,500.00 0.00
Yr5,Q4 10,000.00 500.00 10,000.00 0.00
Reval. 5% 10,500.00 0.00 *8,400.00 **2,100.00
Yr9,Q1 10,500.00 ***262.50 8,662.50 2,100.00
Yr9,Q2 10,500.00 262.50 8,925.00 2,100.00
Yr9,Q3 10,500.00 262.50 9,187.50 2,100.00
Yr9,Q4 10,500.00 262.50 9,450.00 2,100.00
Yr10,Q1 10,500.00 262.50 9,712.50 2,100.00
Yr10,Q2 10,500.00 262.50 9,975.00 2,100.00
Yr10,Q3 10,500.00 262.50 10,237.50 2,100.00
Yr10,Q4 10,500.00 262.50 10,500.00 2,100.00
22
Case 5: Revaluation with Life Extension Ceiling
5 years, and you are using straight-line depreciation. The asset's life extension factor is 3.0 and
its life extension ceiling is 2.
In Year 5, Quarter 4 the asset is fully reserved. In year 9, quarter 1 you want to revalue the asset
with a revaluation rate of 5%.
Revaluation Rules:
To determine the depreciation adjustment, Oracle Assets uses the smaller of the life extension
factor and the life extension ceiling. Since the life extension ceiling is smaller than the life
extension factor, Oracle Assets uses the ceiling to calculate the depreciation adjustment. The
new life used to calculate the depreciation adjustment is 2 X 5 years = 10 years, the life
extension ceiling of 2 multiplied by the original 5 year life of the asset.
Oracle Assets calculates the asset's depreciation expense under the new life of 10 years up to
the revaluation period, and moves the difference between this value and the existing
accumulated depreciation from accumulated depreciation to revaluation reserve.
Oracle Assets then determines the new asset cost using the revaluation rate of 5% and revalues
the accumulated depreciation with the same rate. Oracle Assets calculates the asset's new life
by multiplying the current life by the life extension factor. The asset's new life is 3 X 5 years = 15
23
years. Oracle Assets bases the new depreciation expense on the revalued net book value and
the new 15 year life.
Yr1 to Yr4
Yr5,Q1 10,000.00 500.00 8500.00 0.00
Yr5,Q2 10,000.00 500.00 9000.00 0.00
Yr5,Q3 10,000.00 500.00 9,500.00 0.00
Yr5,Q4 10,000.00 500.00 10,000.00 0.00
Reval. 5% 10,500.00 0.00 *8,400.00 **2,100.00
Yr9,Q1 10,500.00 ***75.00 8,475.00 2,100.00
Yr9,Q2 10,500.00 75.00 8,550.00 2,100.00
Yr9,Q3 10,500.00 75.00 8,625.00 2,100.00
Yr9,Q4 10,500.00 75.00 8,700.00 2,100.00
Yr10 to
Yr15
Depreciation Adjustment (calculated using life extension ceiling)= 2,000

24
Case 6: Revaluation with a Revaluation Ceiling
Example 6: You own an asset which has been damaged during its life. You placed the asset in
service in Year 1, quarter 1. The asset cost is $10,000, the life is 5 years, and you are using
straight-line depreciation. You entered a revaluation ceiling of $10,300 for the asset.
In year 3, quarter 3 you revalue the asset's category with a revaluation rate of 5%.
Revaluation Rules:
o Amortize Revaluation Reserve = Yes
If Oracle Assets applied the new revaluation rate of 5%, the asset's new cost would be higher
than the revaluation ceiling for this asset, so instead Oracle Assets uses the ceiling as the new
cost. The ceiling creates the same effect as revaluing the asset at a rate of 3%. Oracle Assets
bases the asset's new depreciation expense on the revalued asset cost.
Period (Yr, Qtr.) Asset Cost Deprn. Expense Accum.Deprn. Reval. Amortize Reval. Reserve
Yr1 to Yr 2
Yr3,Q1 10,000.00 500.00 4,500.00 0.00 0.00
25
Yr3,Q2 10,000.00 500.00 5,000.00 0.00 0.00
Reval. *3% 10,300.00 0.00 0.00 0.00 **5,300.00
Yr3,Q3 10,300.00 ***1,030.00 1,030.00 ****530.00 4,770.00
Yr3,Q4 10,300.00 1,030.00 2,060.00 530.00 4,240.00
Yr4,Q1 10,300.00 1,030.00 3,090.00 530.00 3,710.00
Yr4,Q2 10,300.00 1,030.00 4,120.00 530.00 3,180.00
Yr4,Q3 10,300.00 1,030.00 5,150.00 530.00 2,650.00
Yr4,Q4 10,300.00 1,030.00 6,180.00 530.00 2,120.00
Yr5,Q1 10,300.00 1,030.00 7,210.00 530.00 1,590.00
Yr5,Q2 10,300.00 1,030.00 8,240.00 530.00 1,060.00
Yr5,Q3 10,300.00 1,030.00 9,270.00 530.00 530.00
Yr5,Q4 10,300.00 1,030.00 10,300.00 530.00 0.00
26
Oracle Assets creates journal entries each period to amortize the revaluation reserve:
Tax Accumulated Depreciation Adjustments Journal Entries
Example: You place an asset in service in Year 1, Quarter 1. The asset cost is $4,000, the life is 4
years, and you are using straight-line depreciation. In Year 4, Quarter 1, your tax authority
requests that you change the depreciation taken in Year 2 from $1000 to $800.
Oracle Assets creates the following journal entries for the reserve adjustment:
Oracle Assets
Cr. Depreciation Adjustment 200.00
Cost Adjustments to Capitalized and CIP Source Lines

When you transfer source lines you adjust the recoverable cost of an asset. Depreciation
is calculated based on the asset type.
Case 1: Transfer Source Lines between Capitalized Assets
Oracle Assets creates the following journal entries for a source line transfer between capitalized assets
Oracle Assets
Dr. Asset Cost (from destination 400.00
asset category)
Cr. Asset Cost (from source asset 400.00

category
.
27
Oracle Assets
(from source asset category)
Oracle Assets
(adjustment)

Case 2: Transfer Source Lines From Capitalized Assets to CIP Assets
When you transfer source lines from capitalized to CIP assets, Oracle Assets must back out
some of the depreciation from the capitalized asset, because CIP assets do not depreciate.
Oracle Assets creates the following journal entries for a source line transfer between
capitalized assets and CIP assets:
Oracle Assets
asset category)
Cr. Asset Cost (from source asset 400.00

category
Oracle Assets
Case 3: Transfer Source Lines from CIP Assets to Capitalized Assets
28
When you transfer source lines from CIP to capitalized assets, Oracle Assets takes catchup
depreciation as for any cost adjustment transaction.
Oracle Assets creates the following journal entries for a source line transfer between CIP
assets and capitalized assets
Oracle Assets
asset category)
Cr. CIP Asset Cost (from source 400.00

asset category)
Oracle Assets
Dr. Depreciation Expense (from 250.00
source asset category)

Expense (from destination
asset category)
Case 4: Transfer Source Lines between CIP Assets
Oracle Assets does not need to reverse depreciation expense when you transfer invoice lines
between CIP assets Because CIP assets do not depreciate.
Oracle Assets creates the following journal entries for a source line transfer between CIP
assets:
Oracle Assets
Dr. CIP Asset Cost (from 250.00
destination asset category)
Cr. CIP Asset Cost (from source 250.00

asset category)
Cost Adjustment by Adding a Mass Addition to an Existing

Asset
If you add a mass addition to an asset, Oracle Assets creates a journal entry to the asset
cost account of the existing asset. Oracle Assets also credits the clearing account you
assigned to the invoice distribution line in accounts payable to net it to zero.
If you want the existing asset to assume the asset category and description of the mass
addition, Oracle Assets creates a journal entry for the new total asset cost to the asset cost
account of the mass additions category. It also creates journal entries for the clearing
29
account you assigned to the invoice line in accounts payable, and for the clearing or cost
account of the original addition category.
Oracle Assets creates the following journal entries for a capitalized $2,000 mass addition
added to a new, manually added $500 asset, where the asset uses the category of the mass
addition:
Oracle Assets
Dr. Asset Cost (from asset 2500.00
category of mass addition)
Cr. Asset Clearing (from original 500.00

asset category)
Cr. Asset Clearing (from original 2000.00

asset category)
Depreciation Method Adjustments Accounting

Entries
Example: You place an asset in service in Year 1, Quarter 1. The recoverable cost is $4,000,
the life is 4 years, and you are using the 200 declining balance depreciation method. In Year
2, Quarter 1, you change the depreciation method to straight-line.
Expensed:
Oracle Assets
Cr. Depreciation Expense (adjustment) 1000.00
Amortized:
Oracle Assets
30

Fixed Assets Accounting Entries

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Fixed Assets Accounting Entries

Uploaded by

Copyright:

Available Formats

Fixed Assets Accounting Entries

Mass Additions Accounting Entries

Case 1: Current Period Addition

Payables System - Current Period Addition

Dr. Asset Clearing 4,000

Oracle Assets - Current Period Addition

Dr. Asset Cost 4,000.00

Case 2: Prior Period Addition

Payables System - Prior Period Addition

Dr. Asset Clearing 4,000

Oracle Assets Prior Period Addition

Dr. Asset Cost 4,000.00

Merge Mass Additions Accounting Entries

Dr. Asset Cost 4,000.00

Construction-In-Process (CIP) Addition Accounting Entries

Dr. CIP Cost 4,000

Deleted Mass Additions no Accounting Entries

Capitalization Accounting Entries

Payables System Accounting Entries

Dr. CIP Cost 4,000

Oracle Assets - CAPITALIZED IN PERIOD ADDED

Dr. Asset Cost 4,000.00

Oracle Assets - CAPITALIZED After PERIOD ADDED

Dr. Asset Cost 4,000.00

Asset Type Adjustments Accounting Entries

Dr. CIP Cost 4,000

Dr. Depreciation Expense 200.00

Journal Entries for Retirements

Depreciation for Retirements Journal Entries

Case 1: Current Period Retirements Journal Entries

Cr. Proceeds of Sale Clearing 2,000.00

Dr. Cost of Removal Clearing 500.00

Cr. Accounts Payable 500.00

Oracle Assets - MULTIPLE GAIN/LOSS ACCOUNTS

Dr. Proceeds of Sale Clearing 2,000.00

Dr. Cost of Removal Gain 500.00

Dr. Revaluation Reserve 600.00

Dr. Net Book Value Retired Gain 1,500.00

Cr. Asset Cost 4,000.00

Cr. Proceeds of Sale Gain 2,000.00

Cr. Cost of Removal Clearing 500.00

Cr. Revaluation Reserve Retired Gain 600.00

Book Controls window:

Accounts Gain Loss

Proceeds of Sale 1000 1000

Cost of Removal 1000 1000

Net Book Value Retired 1000 1000

Revaluation Reserve Retired 1000 1000

Dr. Accumulated Depreciation 2,500.00

Dr. Proceeds of Sale Clearing 2,000.00

Dr. Revaluation Reserve 600.00

Cr. Asset Cost 4,000.00

Cr. Cost of Removal Clearing 500.00

Cr. Gain/Loss 600.00

Case 3: Prior Period Retirement Journal Entries

Dr. Accounts Receivable 2,000.00

Cr. Proceeds of Sale Clearing 2,000.00

Dr. Cost of Removal Clearing 500.00

Cr. Accounts Payable 500.00

Dr. Accumulated Depreciation 2,500.00

Dr. Proceeds of Sale Clearing 2,000.00

Dr. Cost of Removal Loss 500.00

Dr. Net Book Value Retired Loss 1,750.00