How to record a Capital Expenditure or Capitalized Fixed Assets?

How to record a Capital Expenditure or Capitalized Fixed Assets?

Recording a Capital Expenditure or Capitalizing Fixed Asset have 5 major steps.
Step 1: Creating Asset Account
A. Go to Admin -->> General Ledger -->> Chart of Accounts
B. Click on Assets Tab
C. Create assets accounts as mentioned at this link
Note: For example create assets account named "Fixed Asset - Lift"

Step 2: Creating Expense Account
A. Go to  -->> General Ledger -->> Chart of Accounts
B. Click on Expense Tab
C. Create expense accounts as this link
Note: For example create expense account named "Fixed Asset"

Step 3: Creating a new Vendor, if not exist already.
A. Go to Admin  -->> Expense Tracker
B. Click on "Add Vendor" Button.
C. Enter the relevant information
D. Click on "Save" Button.

Step 4: Book Vendor Invoice for asset purchased.
A. Go to Admin -->> Expense Tracker -->> By Vendors
B. Click on "Invoice" Under "Enter Invoice" Column for the row of respective vendor.
C. Enter Invoice details, Select "Expense Head" as "Fixed Asset"
D. Click on "Save" Button.
E. Invoice will be posted for fixed assets purchased.

Step 5: Pass the journal entry.
A. Admin -->> Journal Entries -->> Create Journal Entry
B. Enter Journal Notes as required.
C. Select Journal Date
D. Enter Amount
E. Select Fixed Asset Account for Debit. In this example, Select "Fixed Asset - Lift" which we created before.
F. Select Expense Account for Credit. In this example, Select "Fixed Asset" expense account which we created before.
G. Click on "Submit" Button.
    • Related Articles

    • If I had purchased an asset before 01-04-2013 then how can I account for it?

      If the Assets are purchased in the Last year, you can consider them as a Opening Balance. To record it, please pass a journal entries by following the below steps:  Step 1: Go to General Ledger --->> Journal Entries -->> Create Journal Entry -->> ...
    • I need to capitalise a Fixed Asset?

      Answer-->> a) Go to General Ledger -->> Chart of Accounts -->> Assets --->> Assets Accounts -->> create new account. (For example - Fixed Asset - Computer). b) Go to General Ledger -->> Chart of Accounts -->> Expenses --> create a new account - Fixed ...
    • How to account Fixed Deposit?

      We can enter the fixed deposit into the system. Step 1: create a GL for fixed deposit in general ledger charts of account. Fixed deposit GL needs to create under Assets in charts of account. Step 2: Pass a journal entry for entering the fixed ...
    • How to create ledger account?

      Step 1: Go to Admin -->> General Ledger -->> Chart of Accounts Step 2: Select the respective option from Asset/Liabilities/Income/Expense for type of ledger account you want to create.  ​ Step 3: Select the Group from "Group" list box. Step 4: Enter ...
    • How to add assets?

      ADDA provides you the facility to add assets which belong to your apartment complex (eg: Gym equipment , Office electrical , etc). This will help you with the details of the assets like the last AMC done,cost of the assets,etc. Step 1 : Login to ADDA ...