SAP Financial Accounting (SAP FI) Practice Exam

Disable ads (and more) with a membership for a one time $2.99 payment

Prepare for the SAP Financial Accounting Exam. Enhance your knowledge with comprehensive quizzes and detailed explanations. Ensure you're ready to succeed!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

What does unplanned depreciation refer to?

Depreciation applied at pre-defined rates
Unexpected depreciation that was not scheduled
Depreciation that reduces asset value planned in advance
Depreciation from asset retirements

The correct answer is: Unexpected depreciation that was not scheduled

Unplanned depreciation refers to unexpected depreciation that occurs when the asset’s value decreases due to unforeseen circumstances or events, such as damage, obsolescence, or significant market changes. This type of depreciation is not accounted for in the initial budget or financial planning, which is why it is classified as "unplanned." In contrast, the other choices refer to well-defined depreciation processes. Pre-defined rates are part of planned depreciation methodologies, where depreciation is calculated consistently. Depreciation that reduces asset value planned in advance usually involves a systematic approach to allocate asset costs over time, rather than being an unexpected event. Depreciation from asset retirements pertains to the accounting treatment of an asset when it is retired from service, which again is a different concept than unplanned depreciation, as it normally follows a clear recognition process based on the asset's lifecycle.