If you’re a typical business, then you’ve purchased furniture, equipment (outdoor or office), vehicles, or maybe even property – these are commonly referred to as Fixed Assets. By definition, Fixed Assets must be in use for over 12 months.
QuickBooks has a Fixed Asset list which makes it nice and easy to enter the purchases and easier for your accountant when it’s time for taxes, depreciation, or even selling the asset. Here’s sample report:
While it’s best to let your accountant help you with how you will depreciate them over time, you can be a big help by keeping a list of what your purchase.
Entering a New Fixed Asset
The easiest time to start recording information about a Fixed Asset is when you’re creating a purchase transaction, such as Enter Bills, Write Checks, Enter Credit Card Charges or Purchase Order. Regardless of the transaction, you will be creating a new Item. So here’s an example using checks.
- Create a check: Banking > Write Checks
- Fill in the usual blanks (date, payee, amount…)
- Click the Items tab (NOT the Expense tab) below the MEMO field,
- Click the down arrow in the ITEM field. Scroll up to the top of the list if necessary and select <Add New>. You will see this menu:
- Select Fixed Asset to open the New Item window.
- Enter an easy-to-recognize name
- Select the Fixed Asset Account (check with your accountant if you’re not sure)
- Type a description in the Purchase Description field,
- Click whether it’s new or used.
- Enter the Date purchased, Cost and the Vendor/Payee. Don’t worry about the SALES INFORMATION fields until – and if – you eventually sell the asset.
- You can even enter a serial number and/or warranty expiration date
Transactions Not Required
There may be times when you’ll want to create an item record for a fixed asset when you’re not processing a transaction. Such situations include:
- Transfer of a personal asset to your company
- Purchase of a fixed asset with personal funds, or
- A multi-item purchase.
To do this, click the Lists menu and select Fixed Asset Item List. If you’re adding a new one, right-click anywhere in the list part of the screen and select New (or click the down arrow next to the Item button in the lower left of the screen and click New). The same New Item window that you opened from the check-writing screen appears.
You can view your list of Fixed Assets either in Reports>List>Fixed Asset List (shown at the beginning of this article) or in Lists>Fixed Asset Item List (shown below)
So next time you purchase equipment or furniture, think about using the Fixed Asset tool in QuickBooks.