If your accountant uses the QuickBooks Fixed Asset Manager and you track
your fixed assets with fixed asset items, ask your accountant for more
information about how to set up fixed asset accounts.
Create a fixed asset account for each asset (or group of assets) that you
want to depreciate. For example, you might create a fixed asset account called
Vehicles, or Computers.
How to set up the accounts
What if my accounts are set up
There are several "correct" ways to set up accounts for fixed
assets and depreciation. This topic outlines one method. If you have been using
a different method, you can continue your current practice in QuickBooks.
Add two subaccounts to each asset account that you created. One subaccount
tracks the cost of the asset, the other tracks accumulated depreciation.
How to set up the subaccounts
When you create the subaccounts, follow these guidelines:
Each "parent" account must have two subaccounts.
Name the first subaccount something like "Cost" and the second
subaccount something like "Accumulated Depreciation." In your chart
of accounts, these names will help you distinguish the two subaccounts; for
For the Cost subaccount, enter the original cost of the asset in the Opening
Balance field. Enter the date that you purchased the asset in the As of
For the Accumulated Depreciation subaccount, type 0.00 as
the opening balance if you acquired the asset after your QuickBooks start date.
If you acquired the asset before the start date, enter instead the accumulated
depreciation of the asset as of the start date. Enter this amount as a negative
Finally, create an expense account to track depreciation expense. Give the
account a name such as Depreciation Expense.
Adding new accounts
Entering a depreciation