Let's see how to record the purchase of Fixed Assets
Step 1:
You need to create an account for Fixed Assets through Accounting > Chart of Accounts
Like shown in the above image, fill in the details:
Account Name: Enter the name for the Fixed Asset
Account Group: Select Fixed Asset
Effective Date: Select the date
Opening Balance: Enter the opening balance (purchase amount of fixed asset)
Depreciable Yes/ No: If its depreciable select Yes
Depreciation Rate: Enter the depreciation rate
Save: Click on Save and it's done.
Step 2:
After creating the Fixed assets, let's see how to pass a Journal Entry for the same.
Accounting > Chart of Accounts > Journal Entry, click on add new record.
Step 3:
Select the Fixed Assets account from the drop down. enter the date.
Enter the purchase price in debit column, and credit the cash account/bank account for the same amount.
User can add description in the description box.
To record the purchase of a fixed asset, debit the asset account for the purchase price, and credit the cash/bank account for the same amount. If the fixed asset is purchased on credit than credit the vendor account in place of cash/bank account.
