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Post Info TOPIC: Depreciation
Maya


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Depreciation
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Please could anyone help! I have no one to ask except here! I'm studying wothout a tutor and I'm stuck and frustrated Please could someone guide me Question is: depreciation is to be charged for December in the following amount: Plant and Machinery Cr 500 Office Equipment Dr 300 Motor Vehicle CR 250 how to post these depreciation in the Sage line 50? My jurnal entries keep saying "the Journal is not balance!!! I'm so desperate to get this right. I really appreciate any help. Thank you, May

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NickCraggs


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Hi,

Each depreciation charge should have an equal and opposite element. There will be a debit to introduce the cost into the profit and loss account, and there will be a credit to reduce the valuation of the asset in the balance sheet.

For example, the motor vehicles given above you will debit motor vehicle charge in the P+l, which is around the 8000 code in sage, with £250 and you will credit the balance sheet motor vehicle depreciation code in the balance sheet, which i think is 0051. So you have a equal debit and credit and so your journal will balance.

Hope this helps


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Nick 

Nick Craggs FMAAT ACA  AAT Distance Learning Manager

@nickcraggs 

BKN Tutor of the Year 2013 & 2015


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Maya


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Hello Nick, Thank you very much for your helps, it helps me a lot. I really appreciate it. Maya

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