Chapter 20. Tips for Handling (Almost) Ten Tricky Situations

In This Chapter

  • Selling an asset

  • Tracking owner's equity

  • Doing multiple-state accounting

  • Obtaining and repaying loans

As your business grows and becomes more complex, your accounting does, too. I can't describe and discuss all the complexities you'll encounter, but I can give you some tips on handling (just about) ten tricky situations.

Tip

In QuickBooks, you make journal entries by using the General Journal Entry window, which you get to by choosing Company

Tips for Handling (Almost) Ten Tricky Situations

To track the depreciation of an asset that you already purchased (and added to the Chart of Accounts), you need two new accounts: a Fixed Asset type of account called something like Accumulated Depreciation and an Expense type account called something like Depreciation Expense.

Tip

If you have a large number of assets, keeping track of the accumulated depreciation associated with specific assets is a good idea. You can do this either outside QuickBooks (for example, in an Excel spreadsheet or with your tax return) or inside QuickBooks (by using individual accounts for each asset's original cost and accumulated depreciation).

After you set up these two accounts, you can record the asset depreciation with a journal entry, such as the following one that records $500 of depreciation expense:

 

Debit

Credit

Depreciation expense

$500

 

Accumulated depreciation

 

$500

Tip

The federal tax laws provide ...

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