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Here we're going to show you how to set up a residual balance for an asset so that depreciation
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is taken up to that residual value and the remaining value of an asset after it's been
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fully depreciated is that residual value.
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So we can do this in two ways.
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I'm going to show you when we add an asset via the interface, but just remember that
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this can also be set when you import assets bulk, which is the subject of other videos.
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But for just showing where you can set residual value, let's add a new asset via the interface
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as follows.
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And we'll just call that my new asset.
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Keep it simple code number.
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We can choose to add all of these things.
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Let's put it in the motor vehicles group because that is somewhere you may have a residual
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value.
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We'll say we purchased it for $100,000 and let's go back a few years.
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We'll say we bought it in March 2020 on any old date there and we won't really worry about
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too much.
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Oh, let's put it in Adelaide.
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Okay.
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So once you've nominated the asset group that it belongs to and the cost, you're presented
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with the other details of how you would like to depreciate this asset.
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Firstly, with the tax depreciation and secondly accounts depreciation.
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So residual value is a balance sheet or accounts depreciation concept and asset accountant
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has the option to add residual value right here.
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And you might like to give a reason that always attaches itself to the asset for the auditors
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to see at some future date, but you might just put nominated residual value.
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And it is as easy as that.
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So when we go into the details of the asset for tax, it makes no difference, but for we're
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in the tax tab here, but for accounts or in fact for the tax, you can just see the details
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of when we set up the asset.
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Now if I go over to accounts, you can see that we've got a residual value of $20,000
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and our depreciation allowances for each month, which is pushed through to the journals takes
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into account that $20,000 residual value, which is also noted here.
