German Compound (Method 24)

For the example that follows, these assumptions apply:

• Actual Start Date: June 12, 1997.

• Modified Start Date: June 1, 1997.

• Cost: 100.000,00 DEM (without tax).

• Asset Life: 12 years (144 life periods).

These tables show the depreciation of an asset when using depreciation method 24:

Year	End of Year Date	Accumulated Depreciation	Depreciation Expense
1997	December 31, 1997	-4.882,50	4.882,50
1998	December 31, 1998	-8.327,63	8.327,63
1999	December 31, 1999	-8.327,63	8.327,63
2000	December 31, 2000	-8.350,44	8.350,44
2001	December 31, 2001	-8.327,63	8.327,63
2002	December 31, 2002	-8.327,63	8.327,63
2003	December 31, 2003	-8.327,63	8.327,63
2004	December 31, 2004	-8.350,44	8.350,44
2005	December 31, 2005	-8.327,63	8.327,63
2006	December 31, 2006	-8.327,63	8.327,63
2007	December 31, 2007	-8.327,62	8.327,62
2008	December 31, 2008	-8.350,44	8.350,44
2009	December 31, 2009	-3.445,13	3.445,13

This table shows the second depreciation:

Year	2nd Accumulated Depreciation	2nd Depreciation Expense	Rule 1 Calculation	Rule 2 Calculation
1997	-7.328,77	7.328,77	100.000 / 4383 * 214 days	100.00 * 12.5 percent * 58.630, 13 Initial Year percent
1998	-12.500,00	12.500,00	(100.000 - 4.882,5) / 4169 * 365 days	100.000 * 12.5 percent
1999	-12.500,00	12.500,00	(100.000-13.215,13 / 3804 * 365 days	100.00 * 12.5 percent
2000	-12.500,00	12.500,00	(100.000 - 21.537,76) / 3439 * 366 days	100.00 * 12.5 percent
2001	-5.171,23	5.171,23	(100.000 - 29.888,20) / 3073 * 365 days	100.00 * 12.5 percent * 41.369, 87 Last Year percent
2002	N/A	N/A	(100.000 - 38.215,83) / 2708 * 365 days	N/A
2003	N/A	N/A	(100.000 - 46.543,46) / 2343 * 365 days	N/A
2004	N/A	N/A	(100.000 - 54.871,09) / 1978 * 366 days	N/A
2005	N/A	N/A	(100.000 - 63.221,54) / 1612 * 365 days	N/A
2006	N/A	N/A	(100.000 - 71.549,17) / 1247 * 365 days	N/A
2007	N/A	N/A	(100.000 - 79.876,80) / 882 * 365 days	N/A
2008	N/A	N/A	(100.000 - 88.204,43) / 517 * 366 days	N/A
2009	N/A	N/A	(100.000 - 96.554,87) / 151 * 151 days	N/A

Note: The compound 50 percent is apportioned over five fiscal years. The first and last year have an apportionment percent combined of 100 percent to allow four years of 12.5 percent compound depreciation. Continuing depreciation beyond the asset's life is needed, so remaining basis is not taken in the last year of the asset's life, which reverses the compound depreciation. AAIs (SDA and SDE1) for secondary accounts were set up.

This table explains the requirements for method 24:

Requirement	Explanation
Asset life	The demonstration data includes a version of method 24 for an asset life of 144 life periods.
Balance adjustments	Year-end with annual depreciation Apportioned by period in the year, based on percent
Modified start date	The modified start date is the start of the period.
Conventions	Secondary Accounts are set to two accumulated depreciation accounts and two depreciation expense accounts. Allow Over Depreciation is set to exceed adjusted basis and to continue beyond the asset's life.
Life year rules	Life years 1 to 998 take straight line for rule 1. The demonstration data includes examples for 50 percent over the first four years and for 50 percent in the first year. Different rules for the first, middle, and last years control the life year percent that matches the fiscal year.
Calculations	Remaining number of days are used for straight line. An annual rule multiplier is used for the secondary 50 percent.
Disposals	Method 24 has no disposal rules.