Declining Balance 2 formula help

B3nz
B3nz Member Posts: 37
edited 2009-12-29 in NAV/Navision Classic Client
Hi all,

does anyone know the formula for Declining Balance 2 depreciation in NAV?

thanks

Comments

  • AlexWiley
    AlexWiley Member Posts: 230
    Calculation Method:

    BV = Book value, ND = No. of Depreciation Days, DBP = Declining-Balance Percent, DA = Depreciation Amount, P = DBP/100, D = ND/360

    The formula for calculating the depreciation amounts is: DA = BV * (1-(1-P)D)
  • B3nz
    B3nz Member Posts: 37
    Hi Alex,

    thanks for your reply, but i can't seem to match the formula with the amount generated from NAV

    here's the scenario:

    BV = 1000
    ND = 30
    DBP = 40%

    P = 40/100 = 0.4
    D = 30/360 = 0.08333

    DA = 1000 * (1-(1-0.4)0.08333)
    = 33.33

    which is declining balance 1 in NAV. but in declining balance 2, the depreciation amount i get is 42.

    please correct me if i'm wrong. thanks
  • AlexWiley
    AlexWiley Member Posts: 230
    Did you only do the depreciation for a month? Because DB1 and 2 should depreciate the same amount for the year but different amounts over each period. What version are you on?
  • B3nz
    B3nz Member Posts: 37
    Hi Alex,

    yes i know, both method leads to same depreciation method for the year.
    attached is the each month depreciation for both method that i tested. i know the formula for DB1 and now just curious about the DB2 formula.

    i'm using NAV 5 sp1 btw.
  • AlexWiley
    AlexWiley Member Posts: 230
    Well, if you reverse the formula you can figure out what % it is used, something like:

    -42= 1000*(1-(x/100)30/360)

    The only way I could think that DB2 could have a variable % and still calculate correctly is to calculate for the number of remaining days out of 360 and use that to determine how it inflates or deflates the DB1 %, taking into account the amount of depreciation already taken, which is why your June and July numbers match DB1. Sorry I couldn't help more!

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