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Experienced Member

I lease a piano (asset and liability) and I rent this piano out to a customer (depreciation). The piano was burned . I got insurance money. I will use the insurance money to pay off the loan on the piano. How do I record everything?

 
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QuickBooks Team

Re: I lease a piano (asset and liability) and I rent this piano out to a customer (depreciation)....

Hey there, @jenniferlabadie,

 

It's great having you here in our forums. I can help you account your asset in QuickBooks Online.

 

First, let's create a Bank Deposit for the Insurance money you receive. This way your bank reflects what the insurance company paid you. Follow the steps below:

 

  1. Click the QuickBooks Plus (+) icon.
  2. Select Bank Deposit.
  3. In the Account field at the top, add the bank you want to deposit the payment.
  4. Expand the Add funds to this deposit section to add a new line item.
  5. In the Received From column, enter the vendor (insurance company).
  6. In the Account column, add bank account you want to deposit the amount.
  7. In the Amount field, enter the net amount you received.
  8. Click Save and close.

Once done  use a journal entry to remove the Liability for the asset. Here's how:

 

  1. Click the Plus icon (+) on the Toolbar.
  2. Under Other, select Journal Entry.

If you're unsure which account to use, I'd recommend checking an accounting professional for further assistance. They are experts on what correcting accounts to use for your business type.


Lastly, you can receive the customer payments for the rent or write off the bad debt if needed. Here are some references I've added to guide you with recording customer payments:

 

How to record a customer payment?

How to write off bad debt?

 

That's got it. If you have any questions with the steps, please let me know by clicking the Reply button below. You have me here to help you anytime. Have a wonderful week ahead!