id = "depreciation-final-month-drift"
title = "The final month of a mid-month life takes what the months before it leave, evenly over its days"
rule = "When a life does not start on the 1st, its final month is charged the depreciable amount less what the months before it took, spread evenly over the final month's days."
status = "CONVENTION"
sources = ["ASC 360-10-35-4"]
tags = ["depreciation", "straight-line", "final-month", "month-length-drift", "p3-defect-22"]

[setup]
currency = "USD"
fiscal_year_start = "01-01"
basis = "accrual"
rounding = "half-away-from-zero"

[[setup.accounts]]
code = "1000"
name = "Bank"
type = "asset"

[[setup.accounts]]
code = "1500"
name = "Equipment"
type = "asset"

[[setup.accounts]]
code = "1510"
name = "Accumulated Depreciation"
type = "asset"

[[setup.accounts]]
code = "3000"
name = "Capital"
type = "equity"

[[setup.accounts]]
code = "6200"
name = "Depreciation Expense"
type = "expense"

# Cost 1,030.00, salvage 100.00 (930.00 to depreciate), 3 months from
# 2026-01-15: the life is 2026-01-15 through 2026-04-14.
[[setup.assets]]
id = "D"
description = "Asset D"
cost = "1030.00"
salvage = "100.00"
life_months = 3
in_service = "2026-01-15"
method = "straight_line"
cost_account = "1500"
accumulated_account = "1510"
expense_account = "6200"

[[events]]
date = "2026-01-15"
description = "Capital"
lines = [
  { account = "1000", side = "debit", amount = "1030.00" },
  { account = "3000", side = "credit", amount = "1030.00" },
]

[[events]]
date = "2026-01-15"
description = "Bought asset D"
lines = [
  { account = "1500", side = "debit", amount = "1030.00" },
  { account = "1000", side = "credit", amount = "1030.00" },
]

# Hand check (worked without the code): 930.00 / 3 = 310.00 a month.
# January holds 17 of its 31 days: 310.00 x 17/31 = 170.00. February and
# March are whole: 310.00 each. Before April: 790.00. April holds 14 days
# (1-14) and is charged what is left, 930.00 - 790.00 = 140.00, evenly:
# 10.00 a day (January's own daily rate, 310.00/31). Through Apr 13:
# 130.00; accumulated 920.00; book value 1,030.00 - 920.00 = 110.00.
[[expect]]
query = "depreciation_schedule"
asset = "D"
as_of = "2026-04-13"

[expect.values]
"2026-01" = "170.00"
"2026-02" = "310.00"
"2026-03" = "310.00"
"2026-04" = "130.00"
accumulated = "920.00"
book_value = "110.00"

# Through Apr 14, the life's last day: April 140.00, accumulated 930.00,
# book value 100.00 (the salvage, never depreciated).
[[expect]]
query = "depreciation_schedule"
asset = "D"
as_of = "2026-04-14"

[expect.values]
"2026-04" = "140.00"
accumulated = "930.00"
book_value = "100.00"