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d.riseberg
August 23, 2021
Question

How to report an equipment purchase

  • August 23, 2021
  • 2 replies
  • 0 views

We are using QB Premier nonprofit.

Up to now, we've been fortunate to have all our equipment we use donated to us, so I usually enter the equipment donations in the general journal as Donations in Kind.  We recently purchased a steam cleaner - our first equipment purchase.

How do I enter it into QB.  Do I use a general journal entry? Do I simply enter it as an expense under supplies?

Thanks

    2 replies

    C
    Charies_M
    August 23, 2021

    I'm glad you made it here, d.riseberg.

     

    Let me help you handle equipment purchases in QuickBooks Desktop (QBDT).

     

    For manual tracking of equipment purchase, you can create an Asset Account for the equipment.

     

    Here's how:

    1. Go to Lists and choose Chart of Accounts.
    2. Click the Account button below and select New.
    3. Choose Asset account as the account type.
    4. Click Continue.
    5. Enter your preferred Account Name (Example: Asset Account).
    6. Fill in other necessary information and click Save & Close

    Then, you write a check. Make sure it affects the bank and the asset account you just set up. This is to manually track the depreciation of the asset.

     

    After that, you create an Expense Account for the depreciation. Just follow the steps on how to create an Asset Account and change it to Expense Account this time.

     

     

    You might find this article helpful when creating an account in QuickBooks Desktop (QBDT): Create, edit, or delete account in QuickBooks Desktop.

     

     

    Once done, create a Journal Entry that will debit the expense and credit the asset account.

     

    Here's how:

    1. Go to the Accountant menu.
    2. Choose Make General Journal Entries.
    3. Fill in the necessary information. Under Memo, enter the item reference.
    4. Click Save & Close.

    Here's a good reference to learn more about creating a journal entry in QuickBooks Desktop.

     

    If you wish to review the entries, you can do so by going to the bottom pane of the Make General Journal Entries window.

     

    By default, only entries from the last month are displayed. To change or expand the list of entries, click from the List of Selected General Journal Entries drop-down list and select which period.

     

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    If you're using a Fixed asset manager FAM, kindly visit this article to know how to handle it in QuickBooks Desktop: Use Fixed Asset Manager in QuickBooks Desktop.

     

    Find out more about managing reports in QuickBooks Desktop through the following articles:

    If you need other helpful articles in the future, you can always visit our site: Help articles for QuickBooks Desktop.

     

    Feel free to drop a comment below if you have any other questions. I'm always happy to help. Have a good day.

    K
    kingcohandymanse
    December 23, 2022

    Hi Charies. Are the steps the same for QB Online? 

    katherinejoyceO
    katherinejoyceO
    December 23, 2022

    Thanks for joining in, @kingcohandymanse. To confirm, yes. QuickBooks Online uses the same concept of recording equipment purchases with QBDT. 

     

    But since they have different platforms, you can follow the steps to create an Asset Account for the equipment in QBO:

      

    1. Go to the Settings ⚙ menu.
    2. Select Chart of accounts.
    3. Select either a New account or a New category.  

     

    Next, refer to Step 2: Set up an asset account outlined in this article: Set up an asset account in QuickBooks Online. Then, select the option you see depending on your account view. 

     

    Then, follow the steps to create a journal entry in QuickBooks Online. I'd recommend consulting your accountant to guide you in recording your books accurately.

     

    Check out this article to learn more about the chart of accounts in QuickBooks Online.

     

    Let us know if you need more help in setting up an asset account for your equipment. We're always around to assist.

     

     

    C
    Charies_M
    August 25, 2021

    Hi, d.riseberg.


    Hope you’re doing great. I wanted to see how everything is going about reporting an equipment purchase. Was it resolved? Do you need any additional help or clarification? If you do, just let me know. I’d be happy to help you at any time.


    Looking forward to your reply. Have a pleasant day ahead!

    D
    d.risebergAuthor
    August 25, 2021

    I was talking to someone yesterday (bookkeeper, not accountant), and she suggested simply entering it as an expense vs. an equipment purchase, needing to be depreciated.  Her reasoning was, it is not being used as part of the operation of our organization.  Rather, is is being used to simply keep the facility clean.  Kind of like buying a mop and bucket for the floors, except this is for rugs.  As ana animal (cat) rescue, if we were buying cages, or other types of equipment needed for our operations, that would be listed as an equipment purchase.

    Any thoughts on this?

    M
    Monali
    November 28, 2022

    Hi there,

     

    As i have gone through your chats and have one question. My client is with Pub business. He recently bought a Ninja Air fryer for $ 250. Can i have that categorized as a Kitchen Equipment and show it on Balance sheet or would that be categorized as a kitchen supplies (expense)? Can you solve my confusion on this matter ASAP.

     

    Any help would be appreciated!

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