Journal Entries for Transfers and Reclassifications
Example: You place an asset in service in Year 1, Quarter 1. The recoverable cost is $4,000, the life is 4 years, and you are using straight-line depreciation.
This section illustrates the following journal entry examples:
Current Period Transfer Between Cost Centers
In Year 2, Quarter 2, you transfer the asset from cost center 100 to cost center 200 in the current period.
Prior Period Transfer Between Cost Centers
In Year 3, Quarter 4, you discover that an asset was transferred in Year 3, Quarter 3, from cost center 100 to cost center 200.
Current Period Transfer Between Balancing Segments
In Year 3, Quarter 4, you transfer the asset from the ABC Manufacturing Company to the XYZ Distribution Company.
Prior Period Transfer Between Balancing Segments
In Year 3, Quarter 4, you discover that the asset was transferred in Year 3, Quarter 3, from the ABC Manufacturing Company to the XYZ Distribution Company.
A unit adjustment is similar to a transfer, since you must update assignment information when you change the number of units for an asset. For example, you place the same $4,000 asset in service with two units assigned to cost center 100. In Year 2, Quarter 3, you realize the asset actually has four units, two of which belong to cost center 200.
Note: If all units remain in the original cost center, Oracle Assets does not create any journal entries.
Example: You reclassify an asset from office equipment to computers in Year 1, Quarter 3. The asset cost is $4,000, the life is 4 years, and you are using straight-line depreciation.
When you reclassify an asset in a period after the period you entered it, Oracle Assets creates journal entries to transfer the cost and accumulated depreciation to the asset and accumulated depreciation accounts of the new asset category. This occurs when you create journal entries for your general ledger.. Oracle Assets also changes the depreciation expense account to the default depreciation expense account for the new category, but does not adjust for prior period expense.
Reclassifying an Asset to Another Category