Low-Cost Fixed Assets

Been wracking my brain here trying to determine the best way to handle this issue. I understand completely how to enter and maintain high cost asset items (computers, printers, equipment) through depreciation and serialization. The issue I’m having is what is the proper way to enter lower cost, higher quantity fixed assets like shelving, fixtures, extension cords, etc.

This would be a similar situation that was never solved.

Thanks for any help!


If it’s a fixed asset (irrespective of it’s value), then you should track it using Asset master.

If it’s a consumable asset (like a current asset), then you could set it’s valuation as “Moving Average”. For the low cost items, this valuation method is more appropriate.

@umair I appreciate the response, but I don’t think this is how most businesses would handle things. I mean obviously things that are fixed assets at low costs aren’t always current assets. For example I’m looking at implementing ERPNext for my wife’s small craft business before I go and offer my services to other small businesses, and we have fixed assets that are expensed instead of capitalized (wire grids @ $16). These items will be around for 10+ years and we expensed them when we received them originally and thus wouldn’t be depreciable, yet we still keep an accurate count and keep them on the books.

So my original thought was to enter it into a stock recon like everything else, but then they will show up under Current Assets as that is how the warehousing system works. So I then settled on keeping everything settled up in a spreadsheet and just applying a journal entry to the appropriate accounts and using the spreadsheet to keep up with inventory, but this isn’t a great way of doing things as its outside of the ERP. Not to mention this doesn’t deal with the possibility of purchasing additional in the future as you will need to receive the items in if you are properly following the process.

So I was just wondering what is everyone else’s take on this? How do you handle your small fixed assets? Trash cans, staplers, hole punch, etc? These items via GAAP wouldn’t fall under office supplies as they aren’t consumables and are technically fixed assets, and are definitely not current assets. Just would like some guidance on how others are handling this.

This is possibly a better explanation of what I’m talking about as well: http://businessecon.org/2013/01/the-definition-of-fixed-assets/

The Desk Trash Can – notice it meets both tests! It is not a part of the item sold or service rendered. But you need to be realistic because you don’t want to record a $13 item to your fixed assets ledger. It should be expensed to the profit and loss statement or placed in a large group asset called ‘Office Auxiliary Equipment’ and combined as one line item in the subgroup of Office Equipment (Desks, Computers, Printers, Etc.). This subgroup is generally created when you first start business and purchase everything from staplers to office signage. Group it all together as one line item and it is included in the Office Equipment section of Fixed Assets.

What about creating a warehouse "Small stuff"and give the things you have stored their a value of zero. So, 100 m of barbed wire at $ 0 per meter…If you sell 5 meters one can still assign a value in the sales invoice…

The issue is not that I need to sell the items. I need to keep the items as assets, non-stock items. But since things like say a trash can or a stapler are below a certain threshold then the items would normally be swept into an Auxiliary Asset account. You still keep track of the amount of the items and types, but you don’t track them like you would say a computer or printer.

I followed a PO for a stapler (non-stock) item through on a test install, there was no where to insert a charge or transfer account. So, it appears to me in order to have assets the only way is to follow the actual assets.

Unless anyone has any other ideas, because there is no way that this would fit in with most companies that I could apply ERPNext to. I’m sure I’m missing something.

Ok… So for future people looking on how to handle this I think I’ve found my solution that I will be using. I’m going to completely gut the “Fixed Asset” in the Chart of Accounts. I will then create Warehouses to reproduce the structure and move those accounts into place. I wasn’t aware that you could move the accounts and they would maintain their links to the warehouses. Then enter the items as I normally would as a normal raw goods item. This allows me to only have Fixed Assets assigned to larger items and allows me to keep a perpetual inventory system while also keeping up with small items as well.

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Hope this suggestion might work for you, as an accountant what we give 100% depreciation rate for low value assets so that the asset is depreciated within the year of its purchase and it still remains in the books for control purposes.

What you can do in ERPnext is that

keep the depreciation method as “Straight line method”
keep the total number of depreciations as “1”
keep the frequency of depreciation as “1”
keep the next depreciation run date as your purchase date.

This way the asset will be fully depreciated the day you purchase it and would still be appearing in your register.

For even better control you can add a custom field - “low value assets - high value assets” so that you may identify them in your reports easily.

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