QuickBooks provides an option to add a vehicle in your business vehicles list and track expenses like billable mileage. So that you can record a loan payment for a fixed asset in QuickBooks such as vehicles, machinery, or other company equipment. To do so, you need to create a fixed asset account to record or keep track of the items. As it helps you to track and tally your business health. In this guide, we will discuss how you record a loan payment for fixed asset in QuickBooks with ease.
Understanding of Fixed Assets:
Fixed Assets are goods that are purchased for the long-term usage of the business and are unlikely to be transformed quickly into cash.
The following are some instances of fixed assets:
- Vehicles includes company cars or commercial vehicles
- Office furniture, fixtures, and other equipment.
Moreover, the fixed assets are handled differently from ordinary purchases made by your company on a daily basis.
How do you Record a Loan Payment for a Fixed Asset in QuickBooks?
To record it, you need to first set up the loan payable and for that you can create a liability account. If the loan is to be returned inside the current fiscal year, you can create an Other Current Liability (or Current Liabilities), or a Long Term Liability (or Non-current Liabilities) if the loan will be repaid after the current fiscal year.
Steps Need to Follow to Set up a loan:
➤ Go to the Gear icon and select Chart of Accounts
➤ Next, select a New tab
➤ Now, choose the Other Current Liabilities (or Current Liabilities) or Long Terms liability
➤ After that, select the detail type for “Loan Payable”
➤ Give it a meaning to it like “Equipment Loan from Finance Company Name”
➤ At last, hit the Save and Close tab without entering an opening balance.
Enter the check and apply it to the asset like you did when you paid the supplier for the equipment directly to record the part of the deposit to the finance company. The loan would be recorded as a credit to the beginning loan balance and a debit to the asset (equipment) in a journal entry.
Steps to Record a Loan Payment for Fixed Assets to Track Down Payments and Interest
➤ First, select the Plus (+) symbol >>> Check
➤ Next, complete the Check screen with required details
➤ In case, if you send an actual check then enter the check number
➤ But if you pay online, use direct withdrawal or EFT then enter the “Debit or EF” in the Check/Cheque field
➤ In the Account details area of the check, you need to enter
➤ On line 1, enter the loan’s liability account and the amount of the principal payment
➤ On line 2, enter the interest expense account and the amount of interest being paid
➤ If there are any additional fees, enter them on the following lines, along with the appropriate account
➤ In the end, click on the Save & Close tab.
The above steps will surely help you in record a loan payment for a fixed asset in QuickBooks with ease. In case you are still unable to do it or having some doubts, then you must connect with our QuickBooks support team for the instant help 24×7. Just call or do live chat with our QuickBooks team.
Frequently Asked Questions
Q1. What is the procedure for adding a new vehicle as Fixed Asset in QuickBooks?
Ans: There are mainly two steps you need to perform and the first step is to create a Fixed Asset Account for Vehicle and the second step is to enter the information related to the Purchase Vehicle.
Q2. How to create a Fixed Asset Account for a new Vehicle in QuickBooks?
Ans: ➤ You have to open QuickBooks and select Chart of Accounts option >> New Option
➤ Select the Fixed Asset from the categories drop-down menu
➤ If a fixed asset account is not available then choose any closest account and click Continue
➤ Give an appropriate name and provide a description for account
➤ The name of the account could be Truck or Car and also create a sub-account with a named as per vehicle model
➤ At last, you need to enter the details of the newly purchased vehicle in the Details Type.
Q3. What are the steps I need to do while entering the Purchased Vehicle information in QuickBooks?
Ans: In that, you need to select “Yes” or “No” if you want to track the depreciation of a particular vehicle. If you select “Yes” then QuickBooks automatically creates a depreciation sub-account of the vehicle for you. After that, enter the vehicle amount in the Original Cost field. Once you complete all the information and then click the Finish tab.