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Add Asset Transfer Agreement initials

welcome to this quickbooks 2019 tutorial for beginners my name is matt hulk whis with the quickbooks university and in this video i'm going to go through how to record the purchase of a financed asset alright this causes a lot of confusion for people and so I want to clear this up and how to record this in QuickBooks there's generally two ways that we're going to do this okay you can you can do either way whichever one you're more comfortable with alright and but what typically happens is let's say that a business owner goes if I buys a business vehicle and they purchase this vehicle and they put just part of the money down so they write a check out of the business for part of the purchase price but the rest is financed now what typically happens is that check is recorded in QuickBooks and it's put to a fixed asset okay so a vehicle or whatever it is equipment and the only thing that gets recorded in QuickBooks is the down payment okay and that's incorrect we want to make sure that we get the right assets on there and the right financing so that we have the accurate financial statements okay so in this example what I'm going to do is we're gonna assume we're buying a vehicle for twenty two thousand five hundred dollars and we're going to assume that we are putting three thousand dollars down okay so there's 19 thousand five hundred dollars of financing this is a loan then we're gonna have to pay in the future okay now the first way that I want to show you how to do this is we're gonna make a journal entry okay so if we go to company go to make general journal entries we are going to record the purchase and the financing of this through a journal entry if you're not familiar with journal entries this can get a little bit confusing with debits and credits and things of that nature and so I'm going to show you another way to do this as well okay so the first thing we need to do is we need to choose the fixed asset account okay so if you do not have a vehicles account setup you would set up a fixed asset vehicle account okay because a vehicle is a fixed asset so we're gonna choose this and we're gonna debit the full just price okay not the $3,000 not the financing but the full purchase price okay so this amount in this example it's twenty two thousand five hundred dollars and we can type in the memo to record purchase of you know I don't know just say vehicle okay and just so you know there is a fixed asset area in QuickBooks where you can record specifically the fixed assets I believe I have another video on that that allows you to track the fixed assets it doesn't really it doesn't record it in your books but it does allow you to track specific assets in QuickBooks okay but for this example we're just gonna walk through how to record this okay so the next line that we need to do is the financing all right so now you're gonna look and you're gonna look for a long-term liability now this sample company file has loan vehicles and the various ones okay so if you need to set up a new loan for this vehicle you can see how they have it broken out here we're gonna say this was a van okay so we're gonna say loan vehicles van okay now this amount is going to be the amount of the financing $19,500 okay okay now because this has to balance a debit and a credit a journal entry that the two amounts have to balance they have to equal each other there's the leftover amount of $3,000 okay now because this was a check we're gonna put this to the checking account okay and this will show up in the check register as an amount that came out of the checking account for $3,000 okay and over here you can put cheque number etc whatever you need to do okay so this is a quick and easy way to record this entry so if I hit save and close we will now have twenty two thousand five hundred dollars of vehicles on the balance sheet will have this alone on a balance sheet and this three thousand dollars will come out of our checking account and then we can reconcile just like normal okay so let me hit save and close I don't have any classes on there but if you need a class that you can do that as well okay now the secondly you can do this and sometimes this is easier for people but this can also be a little bit confusing so we want to go to write checks okay so we simply go in and we're gonna record the check that was written to this car company alright alright so we're here on the the check screen and let's assume the check number was 492 you're gonna put in your check number you're gonna put in the date and we're gonna put in the car company okay so the you know the dealer whatever it is alright so you may need to enter them as a vendor right now I'm gonna choose a vendor that is not a car company but we'll say Hamelin metal okay you have unpaid bills we're gonna just write your check okay alright so in this case we only wrote a check for $3,000 so that's what we want to record okay so we're gonna put in $3,000 and in the memo line down here you can say purchase of new yeah okay so down here it's just going to show $3,000 okay so this is where some confusion comes in is how do you record this well a lot of people will just put this straight to vehicles okay but that's not the correct way to do this okay so what we want to do is we do want to choose vehicles so fixed assets vehicles and we want to say twenty two thousand five hundred okay all right now I know you're saying that well this doesn't match up here but bear with me here okay on the next line we want to choose the loan account okay so loan vehicles van and you'll see it automatically does negative nineteen thousand five hundred all right because it needs to balance to this three thousand dollars and you can see the expenses three thousand dollars right here alright so now this will on the books record the loan for 19,500 the fixed asset for twenty two thousand five hundred and then we're writing a check for three thousand which will show up in the register and this will record it the same way as a journal entry now some people prefer to do it this way because you're actually recording the check in the check number and that makes it a little bit easier to track okay some people prefer to do a journal entry it's really up to you it's gonna get you to the same result let me just save and close I don't have any classes on here so it's gonna give me this pop-up here but let me just show you I'm gonna go to the balance sheet and let's see if I have this up here already okay so if if we go to the balance sheet and we look under vehicles okay and let me put in the full month all right you're gonna see the two entries here the one I did is a journal entry and you can see it says general journal and the other one that says check okay purchase a vehicle twenty two thousand five hundred so we've got both of them there now let me go to the loans and you'll see loan vehicles van okay again let me do the full month to show you okay now you'll see both loan entries nineteen thousand five hundred for each okay one is a journal entry one is a check all right so now let me show you here I'm gonna go to the let's say to the check register here alright and you're gonna see let's see we've got one right here which is the journal entry for three thousand dollars okay and then we should have a check for ninety two for $3,000 okay so again both are getting you to the same result you can do either one whichever one you're more comfortable with and a lot of people starting out with QuickBooks are more comfortable with the check route but when you do the check you need to make sure that you record the full amount of the purchase and the full amount of the loan and then the check amount okay any questions whatsoever leave a comment below happy to answer your basic questions also head over to the quickbooks university to get the full training quick in quickbooks over there QuickBooks desktop quickbooks online and also when you purchase the tutorials you become a member and as a member you can ask personal questions i look forward to helping you out over there the way site is Cuba University no RG