ASSET ACCOUNTING JOURNAL ENTRIES

in SAP

1) ASSET ACQUISITION

The entry that gets generated on processing this transaction is as follows:

Dr Asset a/c

Cr Vendor a/c

The asset value dates are mentioned at the time of purchase. The asset value dates
determine the date from which the depreciation would be calculated.

2) RETIREMENT/SALE OF AN ASSET

The entries that get generated are as below: (with notional figures)

   When asset is sold

Dr. Accumulated Depreciation A/c

Dr. Loss on Sale of Asset A/c (if applicable)

Dr. Clearing Account from Asset Sale

Cr. Asset (APC Value) A/c

Cr. Profit on Sale of Asset A/c (if applicable)

 When the asset sold is cleared against the customer invoice

Dr. Customer A/c

Cr. Clearing Account from Asset Sale

 At the time of payment,

Dr.       Bank Incoming A/c

Cr.       Customer A/c

3) WRITE-UP OF AN ASSET

The accounting entry that gets generated is:

Dr Accumulated depreciation a/c

Cr Depreciation

4) DEPRECIATION POSTING RUN

The entries that get generated are as below:

Dr Depreciation a/c

Cr Accumulated Depreciation a/c