Calculating Depreciation When Salvage Value Exceeds Net Book Value (NBV)

There are instances when the residual value (salvage value) of an asset may increase to an amount equal to or greater than the asset's carrying amount (NBV.) If that situation arises, PeopleSoft provides the following treatments for depreciation calculation, depending upon statutory requirements:

• Stop depreciation calculation when salvage value exceeds NBV.

• Allow negative depreciation when salvage value exceeds NBV.