Before recording a donation of a fixed asset item, talk to your accountant
about how to calculate the value of the fixed asset donation and whether you
need to enter an additional adjustment to accumulated depreciation. The value
you assign to the donation cannot be more than the purchase price minus the
amount you have already depreciated.
Example of calculating the value of a fixed asset
You bought a truck for $12,000 and have already depreciated $5,000. The
maximum value you can assign to the donation is the remaining $7,000 that has
not been depreciated.
Using a sales receipt, enter the sale of the fixed asset item for a $0.00
Enter the name of the charity as the customer:job.
Save and record the sales receipt.
Assign the donation to your Charitable Contributions account by entering a
general journal transaction.
Using the value you calculated for the fixed asset, debit the Charitable
Contributions account and credit the fixed asset account. In the following
example, $7,000 is debited from the Charitable Contributions account and
credited to the Truck account.
Enter a general journal transaction to clear your Accumulated Depreciation
account and fixed asset account.
Using the total amount you have depreciated over the lifetime of the fixed
asset, debit your Accumulated Depreciation account and credit the fixed asset
account. In the following example, $5000 is debited from the Accumulated
Depreciation account and credited to the Truck account.
Entering a sales
Creating a journal