The accounting decrease in fixed assets is an indispensable step in the cycle asset management, especially when businesses are faced with the situation of liquidation, sale, property loss. However, for accounting reduce the fixed assets regulations, businesses need to understand the legal principles, the implementation process. This article Accnet will provide detailed instructions, from basic concepts to journal entries specific to support business-easy to deploy accounting solution suitable.
1. Accounting reduce fixed assets, what is?
Accounting reduce fixed assets is the process of recording and processing, reducing the value of fixed assets in the accounting records of the business, apply when the property no longer serves manufacturing business due to other causes, such as:
- Property no longer used or no longer fit.
- Business transfer fixed assets to the Tuesday.
- Property losses due to incidents/factors of force majeure.
The accounting not only does this affect the accounting data, but also a direct impact on the financial situation of the business.
2. The accounting entries accounting reduce the fixed assets details
Depending on the case, the reduction of fixed assets, businesses need to make the accounting entries accounting fit.
2.1. Liquidation of fixed assets
- Reduced-priced properties: TK 211 (fixed Assets tangible) or TK 213 (fixed Assets, intangible).
- Reduced depreciation accumulated: TK 214 (wear and tear of fixed assets).
- Recorded costs in liquidation: TK 811 (other Costs).
The account, for example, A fixed asset has original cost $ 100 million, the wear and tear accumulated 80 million, the cost of liquidation 5 million.
Reduced original price:
- Debt TK 214: 80 million
- Debt TK 811: 5 million
- Have TK 211: 100 million
2.2. Accounting reduce the fixed assets when selling fixed assets
- Reduced the cost and depreciation: TK 211, TK 214.
- Revenue recognition sale of assets: TK 711 (other income).
- Recorded VAT: TK 3331 (VAT payable).
The account, for example, A fixed asset has original cost 200 million, wear and tear accumulated 150 million sale price 70 million (including VAT 10%).
Reduced cost and wear and tear:
- Debt TK 214: 150 million
- Debt TK 811: 50 million
- Have TK 211: 200 million
Recognition of revenue and VAT:
- Debt TK 111/112: 70 million
- Have TK 711: 63,64 million
- Have TK 3331: 6.36 million
2.3. Accounting reduce the fixed assets when lost, damaged, can't fix
- Reduced cost and wear and tear: TK 211, TK 214.
- Recorded cost losses: TK 811.
The account, for example, A fixed asset has original cost 50 million, wear and tear accumulated 40 million, lost can't fix.
Reduced assets and recorded a cost losses:
- Debt TK 214: 40 million
- Debt TK 811: 10 million
- Have TK 211: 50 million
2.4. The important note when accounting for reduced fixed assets
- Ensure the documents related to the reduction of assets such as account management, minutes of loss, bill of sale the property are adequate.
- To comply with the provisions of The Financial accounting fixed assets.
- Avoid the mistakes commonly encountered, such as: wrong value of wear, no noted VAT.
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3. The legal regulations related to accounting reduce fixed assets
Accounting reduce the fixed assets should comply with the laws, rules and regulations. Some key provisions include:
- Circular no. 200/2014/TT-BTC: Rules of accounting business.
- Circular 45/2013/TT-BTC: guidance on the management, use and depreciation of fixed assets.
- The accounting law of 88/2015/QH13 dated: Laying the foundation for all accounting operations in Vietnam.
These regulations clearly define:
- Criteria reduced to fixed assets.
- Procedures and records required.
- How to account for each specific case.
4. Modern solutions in the management of fixed assets
The difficulty in applying the traditional formula in asset management:
- Errors when recording manually.
- Data dispersed, difficult to control.
- Reports slow, lack of transparency.
- Spending a lot of time and human resources.
So, the accounting reduce the fixed assets the current't just stop at the recognition craft but also strongly supported by the modern software, best on the market is LV DX Asset. The outstanding advantages include:
- Software asset management LV DX Asset automatically recorded transactions reduce fixed assets, help reduce errors.
- Integrated tool tracking the life cycle of the property, from being put into use time to lose the property.
- Providing reports on request, from details to general.
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Accounting reduce the fixed assets is an integral part in the management of the assets of the business, requiring the accuracy, compliance law. By mastering the accounting will optimize the use of assets and resources. If your business is looking for the optimal solution for management of fixed assets, experience software, LV DX Asset. Don't hesitate digitized today!
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