Scenario: Capital Work in Progress in SAP Business One
When company purchase asset it require some time for commissioning and setup. Till all expenses incurred are post in capital WIP. Once the asset is ready to use it is capitalize on ready to use date.
Process in SAP Business One 9.1
Step -1:ย Purchase Corn grit milling machine on 01/05/2016, they need at least 4 month to make it for ready to use, thereafter they want to capitalize it. In such case can create Service/Expense purchase invoice.
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The financial posting of this transaction looks like:
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Step 2:ย Now when the asset is ready to use on 01/09/2016 you want to capitalize it, then create Asset master data for Corn grit milling machine. For example purpose I take straight line depreciation method with 20% of acquisition value.
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Step 3:ย Once you create asset master pass the Capitalization entry with actual spend value on that asset to capitalize.
The financial posting of this transaction looks like:
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Step 4:ย Fixed Asset Master Data after capitalization look like this:
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Step 5:ย When you run the monthly depreciation posting entry on 30/09/2016, the financial posting of this transaction looks like:
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Step 6:ย After Depreciation posting Fixed asset master data look like this:
