KPI Reporting - Cost of Sales re Vehicle Leases

Management accounting question KPI Discussion

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By tom123
09th Dec 2016 07:13

Sounds like you have got things a bit confused here.

If your past practice suggests that you sell for net book value at the conclusion of the agreement, you should be depreciating the "cost less net book value" amount over that same time period.

That should give you a level charge reflecting the actual usage. Rather than overstating the depreciation and then having big gains on disposal.

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