A fixed asset can be best defined as a tangible piece of property, plant or equipment. An asset can be described as something that is fixed and a business cannot consume, sell or convert it into cash. Steps to Record a Fixed Asset Purchase in QuickBooks.
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Although the term suggests fixed, it does not always refer to the physicality of an asset. Some companies may move fixed assets regularly for business purposes. Record maintenance of fixed-asset transactions helps you to create valuations. It also aids the businesses in financial reporting, which can prove to be crucial to capital-intensive projects. Most of the businesses own at least some fixed assets.
Know the List of Fixed Assets Example
In financial records, each fixed asset gets an account which records everything valuation, depreciation and so on. Below a list is presented that includes examples of fixed assets.
Buildings and Facilities: Fixed assets may include the owned place or in other words, existing buildings and facilities that are under construction. Anything which is currently under construction exists under an accumulation account (for example, Construction-in-Process) till the work gets completed. On the completion, an accountant will move the asset to the appropriate fixed-asset account.
Furniture, Fixtures and Fittings: Furniture will include all the tangible things like office equipment, conference tables, desks, cupboards and so on. Fixtures also entail built-in items that can’t be easily removed such as fireplaces. Fittings such as mirrors, lights and art which can be removed from one place to another with ease.
Leasehold Improvements: These fixed assets are described as any additions or upgrades you made or had it done to the leased assets or rental property. Such assets can be the built-in cabinets, ceilings, interior walls and any electrical and plumbing upgrades.
Tools: Tools that are used in the business can be the fixed assets. It will be depending on their financial basis and the value threshold of the company.
Vehicles: These assets can include cabs, trucks, cranes, forklifts and many more.
Computer Equipment: Such assets can include computers, servers, laptops, desktops, iPads, drives, storage boxes and so on.
Computer Software: Software can be considered as a fixed asset which is focused on the enterprise packages and platforms. The best example for software assets can be the Cloud-based applications that are treated like software fixed assets. Likewise, any software or program that is focused for internal use will fall into the same category of fixed asset.
In the online version of QuickBooks, the fixed assets list can be used to track individual assets. This list will enable you to enter the required information. These details will include the amount of the item that has been purchased for, the purchase date, and the condition clarifying whether the purchased asset is new or used.
Steps to Record a Fixed Asset Purchase in QuickBooks
For the same, these are the instructions presented that will ensure purchased items or assets are recorded with zero error:
- First of all you need to open the fixed asset item list from the menu bar, then you need to select the List tab and click on the Fixed Asset Item List.
- Then click on the “Add a New Item” option.
- After this, you should click on the “Item” button in the lower left corner of the list window. A pop-up menu will appear before you. Then you need to select the “New” command. You will see the “Asset Name/Number” field. Enter the name or number of the required asset.
- Then you need to select the Account
- Next, you should use the “Asset Account” from the drop-down menu to select the asset account that should be used when tracking the value of said asset.
- Purchase Information Section: In this particular section of “Purchase Information“, you need to select the option to identify the condition of the item whether it is new or used or refurbished. In the “Date” field you should input and record the date of purchase of the item.
- Asset Information Section: Under this section, you need to describe the item by using the “Asset Description” box.
- Hit the save button.
- Click on the OK button if you want to save and close the New Item window. Alternatively, you can also choose to click on the Next to save and leave the New Item window open for further changes.
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Frequently Asked Questions (Faqs)
How to Record Equipment Purchases in QuickBooks Desktop?
The process of entering the equipment purchases is described in some simple steps which are listed below:
• The first step is to go to the Banking menu.
• Secondly, you need to select Write Checks.
• Select the Bank Account you used to make the purchase.
• In the Expense tab, select the Account.
• Enter the Amount of the purchase.
• Click on Save and Close.
How to Manage Fixed Assets in QuickBooks Desktop?
In QuickBooks Desktop:
• The very first step is to create FAM asset(s).
• From the Lists menu, you need to select the Fixed Asset Item List.
• Then you should select the Item tab, and then you should hit the new button.
• After this you should import QuickBooks FAM information into Fixed Asset modules.
• From the Accountant menu in the program, you need to select Manage Fixed Asset.
• QuickBooks Desktop Enterprise: Company > Manage Fixed Asset.
Where is the Fixed Asset Manager in QuickBooks Desktop?
For locating a Fixed Asset Manager, you need to go to the Accountant menu. Then you should choose Managed Fixed Asset and click on the appropriate option for your company. From the FAM menu in QuickBooks, you should again choose Asset Synchronization Options. In the From QuickBooks tab, you need to click on “Automatically” when QuickBooks Fixed Asset Manager opens and both new and modified fixed asset items.