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https://issues.apache.org/jira/browse/OFBIZ-1586?page=com.atlassian.jira.plugin.system.issuetabpanels:comment-tabpanel&focusedCommentId=12560943#action_12560943
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Sumit Pandit commented on OFBIZ-1586:
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For this I would like to suggest to add two fields in the entity FixedAsset
which make field expectedLifeOfFixesAsset more generic in sense of calculate
all depreciation algorithms.
The fields can be :-
1) expectedUsageLife which takes a long value to determine the life of asset
2) expectedUsageLifeUomId which is uom in which the life of asset is
measured.It include uomTypeId = TIME_FREQ_MEASURE, LENGTH_MEASURE, QUANTITY.
using these two fields we can represent the expected life of vehicle in terms
of miles or life of machine in terms of unit of production, life of equipment
in terms of years and so on.....
Note : There is an existing field "expectedEndOfLife" is of type java.sql.Date,
DATE we can replace it with expectedUsageLife or we can change the data type
of expectedEndOfLife.
Let us see the thoughts of Jacopo Cappellato and other people on it.
> Implement more fixed asset depreciation (methods)
> --------------------------------------------------
>
> Key: OFBIZ-1586
> URL: https://issues.apache.org/jira/browse/OFBIZ-1586
> Project: OFBiz
> Issue Type: Improvement
> Components: accounting
> Affects Versions: SVN trunk
> Reporter: Santosh Malviya
> Priority: Minor
> Fix For: SVN trunk
>
>
> There are more 'depreciation methods' which are :-
> (1) Activity Depreciation :- Activity depreciation methods are not based on
> time, but on a level of activity. This could be miles driven for a vehicle,
> or a cycle count for a machine. When the asset is acquired, we estimate its
> life in terms of this level of activity. Assume the vehicle above is
> estimated to go 50,000 miles in its lifetime. We calculate a per-mile
> depreciation rate: ($17,000 cost - $2,000 salvage) / 50,000 miles = $0.30 per
> mile. Each year, we then calculate the depreciation expense by multiplying
> the rate by the actual activity level.
> Formula -
> depreciation = (purchase cost - salvage value) * (current reading - previous
> reading) / expected life in distance unit
> where
> distance unit may be miles, kilometers, etc....
> and current reading and previous reading are reading of the distance meter or
> distance count meter.
> (2) Unit of Production Depreciation :- Units of production depreciation is
> used for assets for which it is better to measure the life in terms of the
> quantity of the resource you expect to extract from them, such as mines or
> wells. For example, the production capacity of an oil well is the number of
> barrels of oil you expect to extract from it. For machinery or equipment, you
> measure the production capacity in terms of the expected total hours of use.
> You can enter the production capacity as the expected total production or
> expected total use. First, you enter the units of production depreciation
> method, production capacity, and unit of measure. You then enter the
> production each period to depreciate the asset according to actual use that
> period.
> Formula -
> depreciation = (purchase cost - salvage value) * (Production for the Period )
> / expected production capacity
> where
> Production for the Period = current production count - previous production
> count
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