Let’s just check out, how to record a vehicle purchase in QuickBooks (Desktop and Online). A few key points that you must know before handling transactions that include fixed assets like cars are provided below. As we know, QuickBooks offers some great functionality for handling transactions of fixed assets such as cars, machinery, buildings, and so on. It even enables you to track depreciation on these assets.
Tracking depreciation can help you make decisions about whether or not to retain the asset and when to sell it. Thus keeping a record of movable and immovable assets becomes all more important.
Fixed Assets: Assets purchased for long-term use are usually called fixed assets. These assets are meant for regular use and are usually more expensive than variable assets. Examples of fixed assets are cars, machinery, and land.
Depreciation: Overtime reduction in the value of any fixed or variable asset is known as depreciation. Usually, we only calculate the depreciation on fixed assets as they are more expensive.
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ToggleTo properly record a vehicle purchase in QuickBooks Desktop or any other fixed asset, follow the steps provided below.
Creating a Fixed Asset Account for Vehicles
To record the purchase of the vehicle, simply record the purchase and link it to the Fixed Asset Account that you created by following the steps provided above.
Setting Up Liability Account
A purchase of a fixed asset may come with associated liabilities like loans and EMI payments. To properly record the entire transaction, the user must enter and track the liability. The liability account will be a Long Term Liability Account. To set up such an account, follow these steps:
If you are planning to purchase a car, it is important to record the transaction in QuickBooks Desktop. This will help you keep track of your finances and keep your records accurate. You can also use QuickBooks to track your vehicle’s mileage.
If you’re thinking of purchasing a car, you’ll want to record the vehicle loan purchase in QuickBooks. This will help you keep track of all your expenses and financials related to the car purchase.
If you’re buying a car, you can easily transaction record a vehicle purchase in QuickBooks Online.
At this point, you should leave the Unpaid Balance field blank as we’ll be handling that later, and note that we are still not yet done with “how to record a vehicle purchase in QuickBooks”. Here we need to pass the loan entry. Recording both the loan amount and depreciation will be done through simple journal entries. These entries will then be linked to particular accounts.
You should also record every payment made for the loan. This can be done by entering checks and linking them to the loan. To record depreciation, you can follow the same steps provided for the loan. Except for this time, select a Depreciation account instead of a long-term loan. Also, you’ll have to regularly create journal entries to keep track of depreciation. Depreciation will have to be calculated by the user.
If you are still not able to figure out how to record a vehicle purchase in QuickBooks then ask for a QuickBooks technical Consultant. At all times, you can turn to us for solutions regarding QB. Our QuickBooks Consultant experts can guide you through any functionality and can also help you set up different accounts and record particular entries. To know more, feel free to contact us.
You can implement the below steps to record my new vehicle in QuickBooks Pro:
● First, select Customer and Vendor profile
● Next, select the Vehicle List
● Go to the Vehicle List window
● Click New in the menu tab
● After that, type the vehicle name in the appearing text box
● Type a description of your new vehicle
● Look for the vehicle as per the manufacturing year
● After done with that, enter more details for identification
● In the end, hit OK to save the description.
Yes, you can easily track your vehicle mileage in QuickBooks Desktop:
● Go to the menu tab and select “Company” >> “Enter Vehicle Mileage”
● Next, choose a vehicle that you wish to record the mileage related to
● Enter both starting as well as ending dates for each mileage transaction
● Now, you have to provide a mileage reading of the vehicle (QB assist you in calculating the total mileage)
● For billing a customer, select “Billable”
● After that, open “Customer: Job” and then “Item” list
● Finally, select the mileage that you wish to bill to your customer.
If you already have created the fixed asset account or the vehicle then perform the steps to enter the complete information of the purchase:
● If you want to track the depreciation of the vehicle then hit “Yes”
● After hitting the yes button, QuickBooks automatically creates a depreciation sub-account of the vehicle
● But you don’t want to track or record depreciation of the vehicle in QuickBooks and then hit “No”
● After that, move to the “Original Cost” field and enter the vehicle amount
● Finally, click Finish once you’re done entering all the information.
● Go to the menu bar at the top and then select “List”
● Next, select the option “Customer & Vendor Lists”
● After that, click “Vehicle List”
● It will open the Vehicle List window
● Using the drop-down menu, select “New” within the same window
● Click “New Vehicle” and then give the vehicle name in the Vehicle field
● Move to the Description and enter the plate or model number
● As per the manufacturer’s year and maker, detect the vehicle
● You have more vehicles then you can enter more information
● Finally, click OK to save all the changes that are done.
Below are the mentioned few advantages of adding vehicles or recording vehicle purchases in QuickBooks:
● You will get a feature to add your worker information that helps in tracking even the traveling expenses.
● Helps in maintaining a record of each mileage of vehicle transactions
● You will get a clerking feature that helps you in conniving the account balance related to the degree account
● You can track workplace Equipment by victimization “Fixed quality Item List” in QuickBooks
● You can update the User’s List with IRS’s mileage rates
● QuickBooks provides 4 different mileage reports such as job details, vehicle details, vehicle outline, and job outline.
