What is amortized cost in SAP FIN-FSCM-TRM-TM - Transaction Manager?

SAP Term: amortized cost

• Component: FIN-FSCM-TRM-TM

• Component Name: Transaction Manager

• Description: A method used for valuation and position management of bonds. Valuation is not based on market prices prevailing on the valuation key date, but on the calculated net present values of the relevant securities account position. If the acquisition value or book value is below par, the system generates a capitalization record which results in a write-up to the calculated net present value. If the value is above par, the corresponding write-down is made.

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• Key Concepts: 
  Amortized cost is a term used in SAP Transaction Manager (FIN-FSCM-TRM-TM) to refer to the cost of an asset that is spread out over its useful life. This cost is calculated by taking the total cost of the asset and dividing it by the number of years it will be used. 
  
  How to use it: 
  In SAP Transaction Manager, amortized cost can be used to calculate the cost of an asset over its useful life. This calculation can be done by taking the total cost of the asset and dividing it by the number of years it will be used. The resulting figure is then used to determine the annual cost of the asset. 
  
  Tips & Tricks: 
  When calculating amortized cost in SAP Transaction Manager, it is important to consider any additional costs associated with the asset, such as maintenance or repair costs. These costs should be included in the total cost of the asset before dividing it by the number of years it will be used. 
  
  Related Information: 
  Amortized cost is related to depreciation, which is a method of accounting for the gradual decrease in value of an asset over time. In SAP Transaction Manager, depreciation can be calculated using either straight-line or accelerated methods.