What is fixed depreciation in SAP FI-AA - Asset Accounting?

SAP Term: fixed depreciation

• Component: FI-AA

• Component Name: Asset Accounting

• Description: The calculation of depreciation amounts that are independent of the multiple-shift usage of the asset. The SAP system allows for both depreciation that is independent of the usage of the asset and depreciation that is variable based on usage. For this purpose, you can split the depreciation of an asset into a fixed portion and a variable portion. The SAP System then multiplies the variable portion by a multiple-shift factor.

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• Key Concepts: 
  Fixed depreciation is a method of calculating depreciation in SAP Asset Accounting (FI-AA) that uses a fixed rate to calculate the amount of depreciation for an asset over its useful life. This method is used when the useful life of an asset is known and can be estimated with a high degree of accuracy. 
  
  How to use it: 
  In SAP Asset Accounting, fixed depreciation is calculated by entering the fixed rate of depreciation in the asset master record. This rate is then used to calculate the amount of depreciation for each period. The total amount of depreciation for the asset is then calculated by multiplying the fixed rate by the total number of periods in the asset's useful life. 
  
  Tips & Tricks: 
  When using fixed depreciation, it is important to ensure that the fixed rate entered in the asset master record is accurate and up-to-date. This will ensure that the correct amount of depreciation is calculated for each period. Additionally, it is important to review and update the fixed rate periodically to ensure that it remains accurate. 
  
  Related Information: 
  Fixed depreciation can be used in conjunction with other methods of calculating depreciation, such as straight-line or declining balance methods. Additionally, SAP Asset Accounting also offers other methods of calculating depreciation, such as accelerated depreciation or sum-of-the-years digits.