Quicken & Other Budget/Accounting Software/Fixed Asset


QUESTION: Under account type for Cost - Computer in chart of account, it will be fixed asset. What about for Depreciation for Computer? The account type will also be fixed asset or other asset?

ANSWER: Hi Farida

The cost type for Accumulated depreciation will be a fixed asset.
That way the balance sheet will summarize the Net Book value of the assets in one section.

Deprecation Expense would be either an Expense or Cost of Goods Sold (COGS) depending on what
is being depreciated (Manufacturing or Warehouse equipment and Plant depreciation would
go to COGS)

Linda Saltz, CPA
Advanced Certified QuickBooks Advisor
We sell and support QuickBooks Enterprise

---------- FOLLOW-UP ----------

QUESTION: What about petty cash?

ANSWER: Hi Farida

Petty cash would be a "bank account" type.

When you write a check to reimburse the petty cash
  pot of money, post that to the bank account petty cash.

Then as employees give you receipts for expenses you would enter
checks or Journal entries to record each expense.  Periodically
you would reconcile petty cash and make sure the amount
in the "pot"  agrees to the amount in the general ledger.

Linda Saltz, CPA

---------- FOLLOW-UP ----------

QUESTION: What about item as below? what is the account type?

1) Deposit
2) Trade Debtors
3) Due from Holding Company
4) Contra account
5) Trade Creditors

What is the difference between :

Other asset and other current asset?
Other liability and other current liability?
Is it similar?

Deposit - generally if the deposit will be held by the vendor for
 longer than 1 year  it is a long term asset

Trade debtors  and Trade Creditors
I copied these explanations from the web

"Trade creditors refer to customers or suppliers to whom cash is owed.
Trade debtors represent cash amounts due to be paid by customers who have purchased goods/services from a company."
"contra account. An account with a balance that is the opposite of the normal balance. For example, Accumulated Depreciation is a contra asset account, because its credit balance is contra to the debit balance for an asset account."

  The vendor is the company's creditor
   sounds like accounts payable.  Possibly
 the company wants to have a separate A/P account for those vendors they
  purchase materials from as opposed to other general operating costs

Due from holding company - sounds like an intercompay receivable -other current asset

Contra account -  the account type would depend on the account type it is offsetting  

Quicken & Other Budget/Accounting Software

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Linda Saltz, CPA, QBalance.com


QuickBooks best practices, troubleshooting, accounting, tax We have over 70 pages of website content about QuickBooks tips, running a business, tax and business startup at http://www.qbalance.com


Accountant and CPA over 20 years. Specializing in accounting software for over 12 years, Certified QuickBooks Pro Advisor, QuickBooks seminar instructor since 1997.
Producer of www.QBalance.com over 100 pages devoted to QuickBooks help and support and training for small business owners in tax and accounting issues.

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