Categories carry the depreciation defaults and ledger accounts so every asset is set up consistently. Fixed Assets → Categories → New category:
- Code *, Name *, Active.
- Defaults — Depreciation method, Useful life (years), Salvage %.
- GL accounts — Asset account (cost on the balance sheet), Accumulated depreciation account (the contra-asset), Depreciation expense account, Disposal gain account, Disposal loss account, and the Work-in-progress account for assets built over time (12.6).
Each account must be of a fitting kind: the asset, accumulated depreciation and work-in-progress accounts are fixed-asset accounts, depreciation is an expense, gain and loss sit in the profit and loss. An asset can't be put in use until its category has its asset, accumulated depreciation and depreciation expense accounts.