I transferred over an existing asset that has not been fully depreciated from one company to another b/c the previous accountant had erroneously coded it there therefore I did the following:
1. I Retired the asset and then changed the entry from posting against the loss account. and then added additional lines: This is what the entry would look like.
Debit Interco account
Debit Accumulated depreciation
Credit Depreciation expense(to transfer the taxable benefit from one company to another, in thus creating wash but correctly recording it in the right company)
Yet when I add the asset to the new company and run a depreciation projection it skips depreciation for December and starts in January 2016. I used an acquisition date of 11/01/2015 and date added of 11/30/2015. That way the depreciation will start in December. Why is it skipping?
I also find myself having to recalculate depreciation each time I want to change it to have it pick up where it left off with the asset in the previous company. When I select Recalculate depreciation instead of reset year or reset life it comes up with the correct dollar amount for monthly depreciation but will not depreciate in December. In order for it to continue where it left off I went into Asset Book and changed the Depreciated to Date to 11/30/2015 and Place in service date of 04/30/2014 even though in the General Fixed Asset screen it says acquisition date of 11/01/2015. I also type the accumulated depreciation into the LTD Depreciation line. This way it picks up where it left off. However I read it doesn't create a journal entry when I select Recalculate. How do I get it to work?
If I am doing this wrong can someone please point out the correct way to do this. We are approaching year end and I really need to get this done. I've tried everything. I just want it to work.