MB-310 Manage Fixed Assets Practice Question

Answer analysis

Option-by-option breakdown

For each option: why learners choose it and why it is or isn't the right answer here.

• ✗

  Set up a fixed asset group with the 'Reducing balance' depreciation method.

  Why it's wrong here

  The fixed asset group is used for defaulting accounts and other settings, but it does not control the depreciation method. The depreciation method is defined on the depreciation profile and assigned via the value model or depreciation book. Setting the method on the fixed asset group is not possible; the group only references a default value model, which in turn has the depreciation profile.

• ✗

  Create a depreciation book with the 'Reducing balance' method and attach it to the asset.

  Why it's wrong here

  While a depreciation book can have a depreciation profile with the reducing balance method, it is not a separate requirement if you are using value models. In Dynamics 365 Finance, depreciation books are being deprecated in favor of value models. The question asks for configurations required to enable reducing balance depreciation, which are the depreciation profile and its assignment to a value model or depreciation book. Creating a depreciation book is one way to assign, but not a separate configuration step beyond assigning the profile.

• ✗

  Configure the fixed asset posting profile to use the reducing balance method.

  Why it's wrong here

  The fixed asset posting profile defines ledger accounts for transactions such as acquisition, depreciation, and disposal. It does not control the depreciation method or rate. The method is determined by the depreciation profile attached to the value model or depreciation book. Configuring the posting profile for reducing balance is not possible and would not affect depreciation calculations.

• ✓

  Create a depreciation profile with the method 'Reducing balance' and set the percentage.

  Why this is correct

  The depreciation profile defines the method and rate for depreciation. To use reducing balance, you must create a depreciation profile with that method and specify the annual percentage. This profile is then attached to a value model or depreciation book, which is assigned to the asset. Without this profile, the system cannot calculate reducing balance depreciation.

• ✓

  Assign the depreciation profile to a value model or depreciation book.

  Why this is correct

  The depreciation profile must be linked to a value model or depreciation book, which is then associated with the fixed asset. This assignment tells the system which depreciation method to use for that asset. The value model or depreciation book also holds other depreciation settings, such as the convention and calendar. Without this assignment, the asset would not have a depreciation method.