Question

Fixed asset & depreciation tracking

Forum|Forum|7 years ago
January 7, 2019
38 replies
88 views

I have 2018 quickbooks desktop pro. Is there an add on module or something to record fixed assets and calculate the associated depreciation schedules? Everything I have come across looks like I would need to buy quickbooks accountant premier version, which is $$$ every year. I am an accountant, but I don't handle other clients, just my husband's S-corp; so I know what I'm doing as far was recording FA and the depreciation. I guess I'm hoping there is another solution besides the expensive yearly fee for the accountant premier version. Thanks!

QuickBooks Desktop

qbteachmt

Level 11

You can use any tool, but what you are asking about is FAM = Fixed Asset Manager that is included when you buy QB Accountant Edition. FAM doesn't do anything but act as "smart" index cards; it connects to the data file to place Entries for you, instead of you making them. Only you know if the amount of FA you need to track makes this worthwhile, as well as Changing that QB data file to using the Fixed Asset Item type; that provides the connectivity.

And the FA regulations changed with the TCJA, making all of this much less hassle.

D

dkirkjohnson

When will QuickBooks Online support a Fixed Asset Manager tool? It is very cumbersome to track it in separately in Excel.

Fiat Lux - ASIA

Level 14

@dkirkjohnson

You need an additional app to integrate with QBO.

F

FTech

There's a new book out called Simple/Smart Fixed Asset Handling in QuickBooks, for the desktop editions. It shows how to set up Inventory Part Items in a special way to work with fixed assets.

It also has a link to a free spreadsheet for calculating depreciation (not tax depreciation, but methods like SL, 1.5DB, DDB, SOYD) and shows a procedure for getting depreciation transactions prepared by the spreadsheet imported into QuickBooks as a batch. (If you have 50 assets you'll have an imported transaction with 50 lines, because the entire fixed asset list is maintained in QuickBooks, in detail.)

There's no software cost beyond the cost of QuickBooks itself--and the price of the book, of course. I think the book's method is a big improvement over using Fixed Asset Items *if* you don't want to buy Accountant or pay the $300+ cost to add FAM to Pro or Premier.

Rustler

Level 15

@FTech

Premier has an name limit of 14,500, for some this does not impact them at all, but down the road you never know.
I played with this same thing back in 08, I have not read the book, hell didn't know there was one

in your screen shot you have "house" and a check for depreciation, what type account is house?
since a depreciation entry is paper, not real, where does the 6K come from?

to get the negative value for the depreciation item, I had to use a vendor credit, for that - it worked. BUT, a/p was wrong on the balance sheet due to the massive vendor credit

Inventory asset on the balance sheet will be correct, but inventory valuation summary will include both the fixed asset item and the depreciation item - big difference in total valuation. You could of course customize the inventory valuation report to include only inventory items you want, but if you add new ones, then you have re-customize the report.

and then there is the item list, even if you preface the FA parent item with zz-, all those inventory items for fixed assets show up in the middle of the item list, making it longer than hell, and harder to select an different type of item. Type ahead will probably find the FA item before it finds the discount or other item.

Back then I did not think about creating a second a/p account for the vendor and the depreciation credit, you could do that in desktop, and then customize the balance sheet to not include that second a/p account. But again if you add or change an account you have to re-customize the report.

more work than it is worth, and too prone to clerical errors IMO

As it stands all my FA are under the parent account, a balance sheet allows me to collapse the sub accounts showing just the sum total as fixed assets. I would much rather have a long account list that I rarely use as opposed to a long item list I use all the time.

Once a year I bring up a memorized journal entry, and if necessary edit any values that need it, and save. Compound journal entry, depreciation expense, and then all accumulated depreciation accounts. Quick and easy.

Out of curiosity, are you the author of the book?

F

FTech

> Premier has an name limit of 14,500, for some this does not impact them at all, but down the road you never know.

Absolutely correct. LIst size is a consideration for any business which has significant number of Items. But many non-retail business types never use more than a couple hundred Items.

> I played with this same thing back in 08...

I did too, years ago, but back then never stumbled upon a setup which would work.

> in your screen shot you have "house" and a check for depreciation...since a depreciation entry is paper, not real, where does the 6K come from?

House is a Customer name used on in-house transactions to keep them out of "real" customer's accounts. Depreciation is entered as a zero-dollar check with a positive total posted to Depreciation Expense and negative amounts to individual assets' Depr Expense subitems. The 6K amount comes from a free depreciation spreadsheet at: https://bit.ly/2EZFbls. The spreadsheet calculates depreciation for each asset and prepares individual-asset depreciation transactions, which are then imported into QuickBooks as a single transaction.

> to get the negative value for the depreciation item...

...you probably had not considered using a zero-dollar check.

> Inventory asset on the balance sheet will be correct, but inventory valuation summary will include both the fixed asset item and the depreciation item - big difference in total valuation....

Correct. The book warns readers to only use specific reports for getting fixed asset information, and Inventory Valuation is not one of them. Items devoted to fixed assets will of course appear in that report but the information about them there cannot be used.

Anyone who uses the valuation total at the bottom of that report (not sure many people do?...most are interested in specific Items or inventory categories, not the report total) will have to adjust it by subtracting the Fx Item's valuation amount. Fx is the parent Item for all fixed asset Items.

> and then there is the item list...Type ahead will probably find the FA item before it finds the discount or other item.

Inventory Part Items devoted to fixed assets all have Fx as their top-level parent Item, which helps with type ahead (and is also essential for easy fixed asset reporting). If you have an Inventory Part Item (earlier in the Item list) named Fx:Widget, and a Non-inventory Part Item (later in the Item list) named Widget, typing "Wid" will find the Non-inventory Part Item. Type ahead doesn't seem to be a problem.

Type ahead can nearly always be improved by how you structure the entire Item list. When the list is very large, making certain Item categories subitems of a short-named parent Item makes Type ahead more work better/more specifically. I just worked with a business that had dozens of Non-Inventory Part Items for different postage types and weights (First Class<1oz, Media Mail-1 lb., Media Mail-2lb., FlatRateBox-Small, FlatRateBox-Medium, etc.). Making all of these subitems of a parent Item named Po (for Postage) made both Type ahead and selection by mouse easier. They type "Po:" and then can select the desired postage Item from the short list of Items QuickBooks presents.

> ...all those inventory items for fixed assets show up in the middle of the item list, making it longer than hell, and harder to select an different type of item.

Longer, yes. But is that any different from the situation in a business which has 10,000 Items? Many non-retail businesses only use a few hundred Items to begin with...but once you've reached that number you really have to be using Type ahead anyway (along with structuring of the Item list like I mentioned above) to make locating Items easier.

A business with 100 fixed assets would be adding 300 to 400 Items to the Item list...not a significant burden. And businesses with a very large number of fixed assets should probably be using the Accountant edition and Fixed Asset Manager anyway, right? Many, many businesses never have more than a couple hundred fixed assets to manage, and an Inventory Part Item approach is appropriate for them.

> Back then I did not think about creating a second a/p account...

Not applicable. No additional A/P account is needed.

> As it stands all my FA are under the parent account, a balance sheet allows me to collapse the sub accounts showing just the sum total as fixed assets. I would much rather have a long account list that I rarely use as opposed to a long item list I use all the time.

Understood...personal choice. But Items have other advantages. One is the ability to let a single Item represent a group of like fixed assets--a fleet of vehicles purchased at the same time, for instance. As some vehicles are removed from the group (sold/wrecked/salvaged, etc.) the Item always has an inventory count of the number of vehicles remaining in the group.

> Out of curiosity, are you the author of the book?

Yes. I only mentioned it here because it was specifically appropriate to the original poster's question.

Rustler

Level 15

@ljfd wrote:

I have 2018 quickbooks desktop pro. Is there an add on module or something to record fixed assets and calculate the associated depreciation schedules? Everything I have come across looks like I would need to buy quickbooks accountant premier version, which is $$$ every year.

When you go to purchase premier in the US, down at the bottom in pricing is this statement

Want to buy QuickBooks Accountant Desktop without a ProAdvisor membership,
or need to purchase for multiple desktop users? Call [removed]

What you did was buy a subscription, joined the pro advisor program which includes an annual update to QB, a newer version in other words

if you call and order it withOUT the pro advisor membership it is a flat price, and will be supported for 3 years for incremental updates. After 3 years it still works fine, with the exception of any online connections to banking, payroll, etc. So at worst, you buy it every 3 years

all my FA are under the parent account, a balance sheet allows me to collapse the sub accounts showing just the sum total as fixed assets. Once a year I bring up a memorized summary journal entry, and if necessary edit any values that need it, and save. Compound journal entry, depreciation expense, and then all accumulated depreciation accounts. Quick and easy.

john-pero

Level 12

My previous CPA and my current CPA both use a separate program for depreciation and enter one annual number from the 4562, I don't lift a finger. I also do not adjust fixed asset value by deducting depreciation from each asset inside of QuickBooks. Our accumulated depreciation account includes it all. But since the CPA has current values for each asset there is no problem when disposing of those assets.

Excel with manual calculations also works.

Rustler

Level 15

@john-pero wrote:

My previous CPA and my current CPA both use a separate program for depreciation and enter one annual number from the 4562, I don't lift a finger. I also do not adjust fixed asset value by deducting depreciation from each asset inside of QuickBooks. Our accumulated depreciation account includes it all. But since the CPA has current values for each asset there is no problem when disposing of those assets.

Excel with manual calculations also works.

A lot of people do it that way, I have a problem with it though, so as food for thought.

if there is a catastrophic event and the cpa's records/computer/data is lost, how long will it take to get the offsite back up (assuming there is one), or if the cpa dies and the estate goes into probate. Or you part ways, and want your detailed data - we have seen folks, on the other better site, asking what to do when requests for the release of the their data are ignored.

B

Bobby Chiggins

Exactly...

What do you think is the best solution?

Rose-A

Level 10

Hi, Bobby Chiggins.

I'm by no means an accounting professional, but I do have some insight to provide that can help get you with depreciation tracking.

To track the depreciation of an asset that you’ve already purchased (and added to the Chart of Accounts), you need two new accounts in QuickBooks:

Fixed Asset type of account called something like Accumulated Depreciation.
Expense type of account called something like Depreciation Expense.

After you set up these two accounts, you can record the asset depreciation with a journal entry.

Here's how:

From the QuickBooks Company menu, choose Make General Journal Entries.
(Optional) In the Make General Journal Entries window, change the Date field.
The Entry No. should automatically populate. If not, type a number for your journal entries. QuickBooks Desktop will automatically number subsequent journal entries.
Enter the General Journal Entry details.
1. Enter or select the first account in your transaction. If you are using an A/R (accounts receivable) or A/P (accounts payable) account, the first account in the General Journal transaction should be the AR or AP account.
2. Enter the debit or credit amount for the account you selected in step a.
3. (Optional) Type a memo describing the transaction. This memo will appear on reports and will include the General Journal entry.
4. Enter or select the Customer, Vendor, Employee, or Other name associated with the transaction. This is required if you use A/R or A/P accounts.
5. (Optional) If you selected an Expense account along with a customer or job, you can make the amount billable to the customer by checking the Billable column.
6. (Optional) Assign a class to the amount.
7. Repeat steps 4a through 4e to enter distribution lines until the transaction reaches a zero balance. The total in the Debit column should be equal to the total in the Credit column.
Click Save & Close.

However, I'd suggest consulting an accountant to help and guide on which account to debit and credit. Your accountant can provide more expert ways of dealing with this situation.

You can get more information about journal entry: https://quickbooks.intuit.com/community/Help-Articles/Record-a-journal-entry/td-p/203691.

Also, you may find these articles helpful:

You can always get back to us if you have more questions in tracking depreciation. Have a great weekend.