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Community Contributor *

Our company sold an equipment. But in the investing activity in statement of cash flow, it shows the original price of the equipment instead of the selling price. Is there any problem with this report?

 
3 Comments
QuickBooks Team

Re: Our company sold an equipment. But in the investing activity in statement of cash flow, it sh...

Hi there, Elim_Wei.


It's possible that you only use the original cost in selling the equipment. You may open the transaction to check if you've added its markup price. 

You can also check with your accountant on how to record a sold equipment. 

 

I made this article handy as your guide to cash flow

 

I'm just around if you need more help. 

Community Contributor *

Re: Our company sold an equipment. But in the investing activity in statement of cash flow, it sh...

Hi Glinette,

Thanks for your answer!

Yes I think the problem is the way our accountant record the transaction. Actually I think his journal entry is correct. It's like:
Credit: Equipment
Debit: Accumulated Depreciation
Debit: Bank Account (amount we receive)
And Gain or Loss on disposal of equipment

But the account under investing activity is just 'equipment' and no other account or sub-account. So it shows original cost of equipment.

In this case, should I create any other journal entry or create a new account?

QuickBooks Team

Re: Our company sold an equipment. But in the investing activity in statement of cash flow, it sh...

Hello there, @Elim_Wei,

 

Several accounts are affected when you sell items. The asset account is where sold items came from. The COGS account is the expense when selling the item. The income account is where the sales price will be posted to. And the bank account where the funds will be deposited to.

 

That being said, you can open the previous JE and add the markup or create a new one to match the amount.

 

If you need a report to show both debits and credits for each transaction, you can pull up the General Ledger. This will help reconcile your monthly statements easily since it displays the entry on the transaction. Here's how:

  1. From the left menu, select Reports.
  2. Open the General Ledger.
  3. Click Customize.
  4. Go to Rows/Columns, then Change Columns.
  5. Mark Debit and Credit to add these columns.
  6. If you wish to see the current reconcile status for each transaction, click Crl.
  7. Click Filter, then choose Distribution Account.
  8. Select your bank from the drop-down menu, then click Run report.

To show you how account balances are affected by debits and credits in QBO, check this out: Double-entry Accounting.

 

Upon sharing this, I still recommend consulting with your accountant for specific instructions on what account to debit and credit.

 

Keep me posted if there's anything else you need and I'd be glad to help.