2 - Managing Fixed Assets - Simplified Method

To manage your Fixed Assets using the simplified method in RIMSS, you will only need to set up the G/L accounts for tracking the assets on your balance sheet and then create journal entries to update the values in the accounts.

Here is an example of tracking fixed assets using the simplified method:

G/L Account Setup

1. You will need to set up the Asset Account(s) and the Depreciation Account(s) with the Account Type of Fixed Asset. These accounts will not be referenced to Fixed Asset. You must have at least one asset account and one depreciation account created. Examples are shown below.

2. You will need to add at least one Amortization Expense account. These accounts will be type Expense and will not be referenced to Fixed Asset. An example is shown below.

Fixed Asset Schedules and Creating Financial Entries

1. When using this method, the fixed asset schedule and depreciation calculations will be maintained separately from RIMSS. This may be done by your tax professional or in a separate program or spreadsheet. The schedule will provide the information on descriptions, Asset Values, Depreciation, Net Values, and more. Below is an example of the type of information that your tax professional might provide.

1. On a periodic basis, you will need to update the values in your RIMSS Fixed Asset accounts.
   1. Asset Values should be added to the asset account at the time of purchase.
      1. Debit Fixed Asset Account
      2. Credit Payment or Liability Account
   2. Depreciation and Depreciation Expense will be booked at the time you receive the schedule from your tax professional or Fixed Asset program. This amount can be posted as a total net change from the current RIMSS g/l account totals and the Fixed Asset schedule.
      1. Debit Amortization Expense
      2. Credit Accumulated Depreciation

An example of a Depreciation entry for one month from the schedule above is shown here.

You may enter depreciation monthly, quarterly, or annually depending on your company policies. Most commonly, an annual adjustment to the total asset value, depreciation, and depreciation expense is entered after the tax professional has calculated the final year end schedule. In this situation, the tax professional typically provides the specific entry for you to make in the system.