Fixed assets and depreciation

A fixed asset is equipment you own for years and depreciate rather than expense at once: a bobtail truck, a transport, a bulk storage tank at your plant, a forklift, or company-owned tanks set at customer sites if your company capitalizes them. This page keeps each asset's cost and value over time, and a monthly depreciation run writes the ledger entries.

What the statuses mean

How to set up asset classes when you start tracking assets

Open Asset Classes (Accounting, Configure) and add one class per kind of asset, for example "Delivery trucks" or "Bulk storage". A class holds the accounts its assets post to (the Asset Account, Accumulated Depreciation Account, Depreciation Expense Account, Write-Off Account, Write-Down Account, and the Gain on Disposal Account and Loss on Disposal Account) and the default depreciation settings: the method, the useful life in months, the residual value percent and the convention. When tax depreciation is tracked separately (Settings, Accounting, Track tax depreciation separately), a class also carries its tax method, including the MACRS property class and convention.

How to add an asset you already own when you start using AimRack

1. Open Assets (Accounting, Fixed Assets) and choose Add Fixed Asset.
2. Enter the name, the Asset Class, the Location (the branch or plant where it lives) and the Serial Number or VIN.
3. Save. The asset is Draft.
4. From its actions menu, choose Register. Enter the Acquisition Cost, the Acquisition Date and the Depreciation Start Date. For a truck that has already been depreciated in your old books, also enter its Accumulated Depreciation. Choose Register. The asset becomes Active.

With accounting turned on, registering also writes the entry that puts the asset on the books: the asset account at cost against retained earnings (and, for an asset registered mid-life, its accumulated depreciation), so no asset exists in AimRack without a matching ledger entry.

How to buy a new asset when it comes through purchasing

1. Add the asset as above and leave it Draft.
2. From its actions menu, choose Purchase. AimRack drafts a purchase order with a Fixed Asset line for it; complete and send the order as usual (purchase orders).
3. When the receipt for that order is posted, the asset becomes Active with the cost added, and the acquisition entry is written. With accounting turned off, the line is received but the asset stays Draft.

How to depreciate every asset when a month ends

1. Open Depreciation and choose Run Next Period. AimRack creates a draft run for the next month end and calculates the charge for every active asset automatically.
2. Open the run and check each asset's charge.
3. Choose Post Run. It posts on the period's last day: depreciation expense against accumulated depreciation. An asset whose book value reaches its residual value becomes Fully Depreciated.

Run Next Period is unavailable while a draft run is waiting to be posted. If you add an asset after a month's run was posted, open that run and choose Repeat Run: it creates a new draft run for the same month covering only the active assets the first run missed. Month-end close warns you about a draft run left unposted (accounting).

Register, Dispose and Post Run each post into the accounting period their date falls in. A closed month refuses the posting until it is reopened, and a month whose fiscal year has no periods yet refuses until that year's periods are generated (accounting). A locked month still takes these postings, because they are accounting adjustments.

How to sell an asset when a buyer takes it

From an active (or fully depreciated) asset's actions menu, choose Sell. AimRack drafts a sales order with a Fixed Asset line priced at the asset's net book value. Adjust the price if you agreed another, and bill it like any sale (sales orders). Selling does not take the asset off the books; dispose of it when it leaves.

How to retire an asset when it is scrapped or leaves the fleet

From the actions menu, choose Dispose, enter the Disposal Date, and confirm. Disposing clears the accumulated depreciation, removes the asset at its cost, and books any remaining book value to the class's Loss on Disposal Account. The form shows the Current Net Book Value before you confirm. The asset becomes Disposed.

Where this fits

Assets bought through purchase orders arrive on a receipt. Each month's depreciation run writes journal entries, and the Assets report in Reports shows asset activity by location, item or any dimension.