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DECLINING BALANCE,
PERCENTAGE REMAINING,
PRORATION SOFTWARE |
by
Financial Data Support Systems, Inc.
for Windows® PC, workstation, networks |
Monthly recognition of an Excel file containing
• Deferred Income,
Revenue, Fees,
• Prepaid Assets,
Expenses, Deferred Charges
based
upon the balance remaining, monthly takedown or running consumption of
• Time: Hours, days, other increments
• Tangibles: Inventory, products, supplies, other type of count
• Dollars: Outstanding loan balance
• Virtually any values with a declining life expressed as numerical
units
To amortize using straight line, click here
A $24,000.00 fee provides 1200 hours of service
over a 12 month term.
You might be the payer
who capitalizes a $24,000.00 prepaid asset/expense.
You might be the provider
who establishes an unearned deferral.
Amortizing the fee on a straight line basis presumes
a monthly consumption rate of 100 hours.
A payer expenses $2,000.00
per month.
A provider recognizes
the same monthly amount as income.
However, what if hours (or any underlying value
type) are reduced at a completely different rate?
What if 312 hours are
used the first month, followed by 228, then 367?
What should the deferred
balance be after three months when 907 hours have been used?
75% of the original
deferral? $18,000.00? When less than 300 hours remain?
This software recognizes a deferral based upon
units consumed
For a payer, as expense.
For some, the above example might apply to a year's worth of printer cartridges.
For a provider, as income.
Maintain data in an Excel spreadsheet file
On a monthly basis, the software imports your
Excel file and
Calculates accumulated
amortization of deferred dollars using a straight line basis.
Determines which of
the following is provided in the file:
Units (hours) consumed to date or
Units consumed for that month or
Units remaining.
Calculates the percentage
of units consumed to date compared to total beginning units.
The greater of the two calculations is recognized
as accumulated.
A history file is created.
Monthly recognition is the difference between
last month's historical accumulated and this month's accumulated.
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Samples
Maintain records in a simple Excel file.
Column layout can differ from this Demo example.
The deferral amount in column C could instead
be located in column G.
Current Units (in column F) could instead be
Units Consumed for the month and located in another column.
Add new records and each month update:
Column F, Current Units
(remaining balance) or
whatever's easiest for
you, such as a column containing:
Units Consumed That Month or
Units Consumed To Date
After importing the file, the software performs the calculations and
prepares a Trial Balance.
It also prepares a Journal Voucher for posting to the general ledger.
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