I’m moving our accounts over from a spreadsheets into QF, all going pretty well, but I need some help with bringing in our Fixed Assets. I have successfully generated a journal for our opening stock. But I can’t work out which codes to use for the Fixed Assets. I’m assuming I need to credit for example (0020)Plant and Machinery but I dont know which code to Debit , Im assuming it would be “Opening Plant and Machinery” or similar but I cant find anything like that. Am I anywhere close on this? Any help would be appreciated
You would debit the asset code, not credit. The credit entry is “where the money came from to fund the asset” and would typically be either “retained profit” (if the business bought it with money it had earned in a previously) or if you purchased the asset with personal funds then “capital introduced” (for sole trader/partnership) or “director’s loan” (for a limited company).
Hi Ian, ok great , thanks for the clarification. The Crediting and Debiting of assets seems counter intuitive but I have gone with it and my Balance Sheet now seems to make more sense. The ‘Stock’ is now in green under assets and the ‘Plant and Machinery’ and ‘Vehicles’ is also green under Fixed Assets. So I think I’m there.
I really only started using QF because HMRC have deemed spreadsheets not acceptable for Vat returns,so I am on a steep learning curve here. Thanks for your help.
Yeah, the whole debit and credit thing takes a bit of getting used to. I remember it as the credit says where the money came from and the debit says where it went to. So sales and liabilities are credit, expenses and assets are debit.
In particular if you’re looking at the nominal account view of a bank account, money in transactions are debits and money out transactions are credits. This feels backwards when you’re used to looking at bank statements but it does make sense if you realise that the statement the bank sends you is from their point of view whereas the accounts in QuickFile are from yours. From the bank’s perspective when you deposit money that’s money moving from (credit) you and to (debit) their pile of cash, from your perspective it’s money going to (debit) the bank.
Thanks , that definitely makes sense. Its a good way of remembering it. Cheers!
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