Depreciation question

I am creating a manufacturing industry sector that I will import using the Industry Spending Pattern. I have survey results for their intermediate goods and services and have mapped those expenditures into the appropriate commodity codes. I also have their payroll. After all intermediate goods and services have been paid, I am taking the residual of their total industry output (TIO) and shifting it to proprietary income. The proprietor is the residual claimant. My question pertains to their depreciation. Depreciation for this sector amounts to about 2% of TIO, so not huge, but I’d like to get it right. I thought depreciation was part of OPI. I think there are three possibilities on how to treat the depreciation. 1) I can shift the 2% share of TIO that is depreciation to OPI. If I shift it to OPI it will be a leakage. 2) I ignore it, in which case the proprietary income account gets 2% more of TIO. 3) I can deduct it from TIO prior to calculating the absorption coefficients and share to employees. In which case, each factor of production and proprietor receives a slightly larger amount of TIO. Ultimately, I will be using this to make estimates in how changes in the output of this target industry will affect the study area. Which alternative is best, and why?