You can create masters for fixed assets, record the relevant transactions for sale of fixed assets and view the details in VAT reports and balance sheet.
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Journal entries for adjusting profit or loss on sale of fixed assets
Fixed Assets and Capital Goods are maintained as ledgers to address the accounting transactions that accompany handling of these assets such as depreciation, appreciation and so on, and not as stock items.
Go to Gateway of Tally > Accounts Info. > Ledgers > Create .
Create a master under the Fixed Assets group as shown:
Go to Gateway of Tally > Accounting Vouchers > F9: Purchase > click I : Accounting Invoice .
Record purchase of fixed assets in accounting invoice mode with VAT as shown:
In case of fixed assets, the depreciation in value of these assets needs to be brought into the books. You have to record the depreciation voucher before recording the sale of fixed assets.
1. Go to Gateway of Tally > Accounting Vouchers > F7: Journal .
2. Debit the depreciation ledger grouped under expenses, and enter the value of depreciation.
3. Credit the Fixed asset ledger.
4. Press Enter to save.
Go to Gateway of Tally > Accounting Vouchers > F8: Sales > click I : Accounting Invoice .
Ensure the ledger used for sale of fixed assets is grouped under Sales Accounts . Record sale of fixed asset in accounting invoice mode, by selecting the VAT ledger based on the party's Place of Supply.
This sale value will appear in your trading account and Sales Register . As the sale is of fixed asset, you need to transfer this amount to fixed asset ledger, to form part of the Balance Sheet .
Note : Sale of fixed asset can be recorded in journal voucher as shown below, but you cannot generate the sales invoice.
Go to Gateway of Tally > Display > Statutory Reports > VAT > VAT report.
Balance sheet appears as shown:
Account for profit on sale of fixed asset
Transfer the profit to income ledger to reflect the actual value of fixed assets in Balance sheet.
Example: After charging depreciation on fixed assets, if the net value of the fixed assets is 4,000 and the sale value is 5,000, record a Journal voucher to transfer the profit as given below:
Debit: Sale of Fixed assets = 5,000
Credit: Fixed Assets = 4,000
Credit: Indirect Income = 1,000
Account for loss on sale of fixed asset
Transfer the loss to expense ledger to reflect the actual value of fixed assets in Balance sheet.
Example: After charging depreciation on fixed assets, if the net value of the fixed assets is 5,000 and the sale value is 4,000, record a Journal voucher to transfer the loss as given below:
Debit: Sale of Fixed assets = 4,000
Debit: Indirect Expenses = 1,000
Credit: Fixed Assets = 5,000
'Sales of Fixed Assets Under VAT' has been shared with