diff --git a/erpnext/assets/doctype/asset_capitalization/asset_capitalization.py b/erpnext/assets/doctype/asset_capitalization/asset_capitalization.py
index 7d08581cbe..a8f2d79c27 100644
--- a/erpnext/assets/doctype/asset_capitalization/asset_capitalization.py
+++ b/erpnext/assets/doctype/asset_capitalization/asset_capitalization.py
@@ -371,6 +371,7 @@ class AssetCapitalization(StockController):
 				self.set_consumed_asset_status(asset)
 
 				if asset.calculate_depreciation:
+					self.reverse_depreciation_entry_made_after_disposal(asset)
 					self.reset_depreciation_schedule(asset)
 			else:
 				if asset.calculate_depreciation:
diff --git a/erpnext/assets/doctype/asset_capitalization/test_asset_capitalization.py b/erpnext/assets/doctype/asset_capitalization/test_asset_capitalization.py
index 5a342f7d2f..7046de6f83 100644
--- a/erpnext/assets/doctype/asset_capitalization/test_asset_capitalization.py
+++ b/erpnext/assets/doctype/asset_capitalization/test_asset_capitalization.py
@@ -174,6 +174,7 @@ class TestAssetCapitalization(unittest.TestCase):
 		self.assertEqual(actual_gle, expected_gle)
 
 		# Cancel Asset Capitalization and make test entries and status are reversed
+		asset_capitalization.reload()
 		asset_capitalization.cancel()
 		self.assertEqual(consumed_asset.db_get('status'), 'Partially Depreciated')
 		self.assertFalse(get_actual_gle_dict(asset_capitalization.name))