We explain how the depreciation of computer equipment is calculated.
It is important to have control over computer equipment in order to decommission it when it is no longer operational in the company.
According to the General Accounting Plan, computer equipment is recorded in account 217 of Information Processing Equipment , where other electronic equipment, such as a tablet, would also be recorded.
Correct amortization of denmark email list company assets is essential to correctly determine the accounting and tax results of any company.
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By depreciating computer equipment, the company transfers part of its value to its income statement as an expense. Fixed assets, having a life of more than one year, cannot be recorded as an expense in their entirety in one financial year.
Amortization records the loss in value of the company's assets , since they lose value with use and the passage of time. In the latter case, not only due to deterioration, but also due to obsolescence.
Amortization reflects this reduction in the value of the fixed assets available to the company to carry out its activity in the assets section of the balance sheet .
Therefore, the amortization accounting entry reflects the systematic and irreversible depreciation suffered by the fixed assets , due to their application to the production process over several years.
To calculate the depreciation of computer equipment, we must take the following steps:
Identification and control of computer equipment
Once a computer has been purchased, it must be identifiable in the company's accounting records and physically , in order to facilitate its control. To do this, the computer equipment can be given a label with an identifier and a detailed description can be included in the accounting account.
This control will facilitate the creation of inventories of the company's assets and will facilitate their disposal if their useful life ends or they are sold.
Accounting registration of fixed assets and depreciation accounts
If we have accounting software like Sage 50 , calculating depreciation will be much easier . Sage 50 allows you to manage the entire depreciation process of fixed assets. In this way, the depreciation entry will be generated automatically and you will avoid having to use spreadsheets to keep track of your company's depreciation.
