Activity-Based Depreciation

The Activity-Based Depreciation tab is used to calculate depreciation for fixed assets (FA) that are configured to use the Activity-Based Depreciation method in the Accounting tab. This method allocates a FA’s cost based on actual usage or output (such as machine hours operated, units produced, or kilometers driven) rather than the passage of time. This provides a more accurate representation of the FA’s actual wear and consumption over its operational life.

The Activity-Based Depreciation tab can be accessed by right-clicking within the AR00 – Depreciation/indexation of fixed assets module and selecting Activity-Based Depreciation.

Hint Examples of how to use the Activity-Based Depreciation tab are described on the corresponding pages of the User Manual for PANTHEON.

The Activity-Based Depreciation tab consists of the following functional units:

Inventory No. (Inventory Number)	Displays the unique Inventory Number of the FA for which Activity-Based Depreciation is being calculated.
Name	Displays the primary Name of the FA associated with the Inventory Number, which helps to accurately identify the FA.
Units in Life Cycle	Indicates the total expected usage of the FA over its entire lifespan (e.g., 200,000 km for a vehicle or 7,000 hours for a machine).   Warning This field cannot be edited, as the value is defined in the Accounting tab under the Activity-Based Depreciation section.
Units in Period	Enter the actual number of units used during the depreciation period being calculated (e.g., kilometers driven in a month or hours a machine was in use).   Warning Based on this entry, the program automatically calculates the corresponding depreciation expense. Accurate data entry in this field is essential, as it directly affects the depreciation calculated for the period.
Cumulative Units	Automatically calculated once Units in Period field is filled-in. It shows the total sum of all previous Units in Period values for the FA, including the current period.   Hint This field helps track total wear and determines how close the FA is to the end of its expected useful life.
Factor	This factor is used to dynamically adjust the depreciation amount and is calculated automatically once the number of units are entered in the Units in Period field.

Hint When data is entered in this tab and depreciation is calculated, the corresponding fields in the Accounting tab under Activity-Based Depreciation are automatically updated with the calculated values.