16 Nov Fixed Asset Loan
Fixed Asset Loan
One of the easiest ways to tell if an asset has not been recorded correctly is that a small amount will appear in the fixed asset register. Usually the difference is a loan that has not been recorded. For example, a new truck purchase for $1,000. That transaction would lead to discovery that the $1,000 was a down payment on a new truck, with the remaining balance being paid by a loan.
To record the transaction correctly, obtain the bill of sale or other paperwork that supports the purchase. This paperwork should detail any additional costs that should be capitalized (such as delivery and/or installation), as well as any amounts that can be expensed in the current period (for example the license fee for a vehicle purchase).