It is recommended that you spend a great deal of time familiarizing yourself with the capabilities of your QuickBooks Online account to make the most of the software and avoid errors. Use our QuickBooks bookkeepers guide below to record a fixed asset in QuickBooks.
What Is a Fixed Asset in QuickBooks?
Real estate, land, machinery, vehicles, and IT equipment are examples of fixed assets. It is an asset that cannot quickly be converted into cash. A fixed asset in QuickBooks can also be referred to as a tangible asset.
When determining what is a fixed asset in QuickBooks, you can think about equipment or property that a business owns and needs if it is to function and generate income. Fixed assets are not easily consumed. On a balance sheet, they appear as PP&E: property, plant, and equipment. Some refer to these as capital assets.
How to Record a Fixed Asset Purchase in QuickBooks Online
1. Open the Fixed Asset Item ListFrom the menu bar, select List > Fixed Asset Item List
2. Add a New ItemClick the “Item” button in the lower left corner of the list window. From the pop-up menu, select the “New” command. You will see the “Asset Name/Number” field. Input the name or number of the asset.
5. Select AccountNext, use the “Asset Account” drop-down to select the asset account that should be used when tracking the value of said asset.
6. Purchase Information SectionIn the “Purchase Information” section, select the option to identify if the item is new or if it is used. In the “Date” field input, record the date you purchased the item.
7. Asset Information SectionUnder the “Asset Information” section, describe the item by using the “Asset Description” box.
8. SaveClick OK if you want to save and close the New Item window. Alternatively, click Next to save leave the New Item window open.
Sales Information SectionYou can use this section to record information about the item if you sell it later on. Mark the “Item Is Sold” section and enter a “Sales Description” that will be followed by a sales date, price, and expense.
Accurately recording a fixed asset purchase in QuickBooks
Accurately recording a fixed asset purchase like a new computer or real estate property in QuickBooks helps you:
- monitor your finances and the impact of the purchase
- accurately file your taxes at the end of the year
- give your tax practitioner the information they need for tax planning
Get Help with QuickBooks Online
QuickBooks is a user-friendly program once you get the hang of it. However, there can be a steep learning curve initially because it is a comprehensive software. This means that while it is easy to understand some aspects of QuickBooks Online, like recording a fixed asset purchase, deeper functions can be complicated.
Fusion CPA is staffed with CPAs and accountants who are experienced in using QuickBooks Online. We can show you how to add assets in QuickBooks Online and walk you through the process using a host of accounting and bookkeeping software. Our team of experienced accounting professionals can help you keep your software up-to-date and steer clear of issues with the IRS. The goal is to improve the financial health of your business. We look forward to learning more about your business and how we can help you face its current challenges.
This blog article is not intended to be the rendering of legal, accounting, tax advice or other professional services. Articles are based on current or proposed tax rules at the time they are written and older posts are not updated for tax rule changes. We expressly disclaim all liability in regard to actions taken or not taken based on the contents of this blog as well as the use or interpretation of this information. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive.