Managing your fixed assets with the help of FAM (Fixed Asset Manager)
FAM( Fixed Asset Manager ) can be defined as a free to use feature Provided to QuickBooks users on their copy of software. This feature has the ability to compute the Depreciation of your fixed assets. All the results of this feature will be based on Standards that had been published by the IRS itself.
Here in this article there will be a complete explanation of terminologies and depreciation method including predefined report and fixed asset manager.These all terms will help you to do a better management of you asset information.
Note:- QuickBooks FAM feature is only available for users that own-
QuickBooks Premier Accountant
QuickBooks Enterprise Accountant
Capitalisation Limit- The limit that differentiate between asset purchase and expense can be defined as capitalisation limit. Capitalisation can be different for every company depending on its size. This limit can be from 300 dollars to 30,000 dollars.
Fixed Asset- Items that are tangible can be defined as a fixed asset which can Land,Building,Furniture,Machinery or any other equipment that can be useful for more than above are examples of fixed assets.Fixed assets have a price tag that is above minimum capitalisation limit.
Depreciation- It can be defined as a decline in the price of an asset over a period of time due to deterioration, obsolescence as well as impending retirement. Depreciation can only happen with physical asset sur as machinery. Tracking this loss in value is essential for tax purposes.
Disposal of Asset- This term is user for removing any asset from a company. This can be because of many reasons like theft, throwing away or selling the asset.
SL ( Straight-Line Method)- This is the easiest way to add depreciation as in this method depreciation amount is equally allocated to every time period.
Declining Balance Method(200% & 150% DB) – In this method depreciation added to early years when asset is new is more than it is at a later time period. As there will be less down time and repairs the company would use the asset more in the beginning of its lifetime.
Income Tax Method (MACRS)- In this case double declining balance method gets used. In this you take only half the depreciation of a year.when asset reaches middle of its like then it is switched to straight line method. In this case any 5 year asset may take 6 year to depreciate.
ACE Adjustment Calculation- Tax return of a corporation is computed in order to determine the total ACE. Every asset is grouped into categories and then sorting is done according to asset number within every group being made.
Amortisation Schedule by General Ledger (G/L) Account Number- Assets get grouped by the general ledger account number and then it is sorted by using the asset number which is within each group in order to see a proper summary of all activity by amortised asset.
Amortisation Schedule by user defined- This means having a proper summary of every activity related to asset amortisation that have been grouped a user defined classification.all assets are sorted by an asset number.all assets are grouped by the user defined field.
AMT Adjustment Calculation- This means to print out all necessary information regarding the depreciation adjustment report – ( Federal dep – AMT dep= AMT adjustment).All assets are being grouped into a category and then are sorted by asset number within every group.
Asset Disposition by Asset Sales Description- This means to see a proper summary of disposition information that is set according to the asset sale description. All assets get grouped by the sale of asset description and can be sorted by asset number divided into each group.
Asset, Basis & Disposal Detail Report- This means printing out details of assets that are in asset and disposal tabs that you can see on the screen.
Assets Acquired in the current year- For having a proper summary of every asset that has been purchased on the current year.All assets are grouped by general ledger account number and are then sorted by the acquisition date inside every group.
Depreciation Schedule by G/L Account Number- In order to see an activity summary for each and every asset that is grouped by general ledger account number. Sorting of assets is done by purchase date of asset within each group.
Depreciation Schedule by user defined- This means that to see the activity summary of each asset that has been grouped by user defined category . Asset number is used to sort in each group.
Lead Schedule By Category- This is a summary of activity made by the assets that are grouped by category, this is done in a traditional lead schedule format. All assets get sorted by the asset number inside each group.
Lead Schedule by G/L Asset Account- This is a summary of assets that have been grouped by – General ledger account number.this is done in a traditional lead format. All assets get sorted by asset number inside each group.
Lead Schedule By Location- This is a summary made for assets that are grouped by their location by traditional format.Assets get sorted by asset numbers inside every group.
Lead Schedule by Tax From and Property Description- This is a summary of assets that get grouped via tax form & property description.All are done by traditional format.Assets get sorted by asset numbers inside every group.
Monthly G/L Asset Account Summary- This shows depreciation & amortisation. This also includes any addition or deletion as well as the ending and beginning balance.General ledger asset account is used to make grouping in this. All assets that are not assigned with an account number are grouped into category- “ No Account Number”.
Monthly G/L Asset Account Summary- To view the sum of Depreciation and changes made to it. Method used to group this report is – General Ledger Depreciation expense account. Assets that do not have account number come under “ No account Number”
Property Schedule by year of acquisition- This is a summary of amount depreciated on assets that are marked as a personal use. All assets get grouped according to the year of purchase and then get sorted by acquisition dates.
Projection by Category- For viewing a 5 year projection of each asset. Assets get grouped into categories and then get sorted using asset number inside each group.
Remaining Basis Over Remaining Life Report- Identification of assets that have not been charged with depreciation. Grouping in this report is done according to subtotalled by the category.