When you buy a fixed asset, you must record the transaction using a fixed asset ledger account. This ensures the asset appears on your balance sheet rather than your profit and loss report. You can record the purchase either as an Other Payment or a Purchase Invoice, depending on how you paid for the asset.

Step one: Choose the right method

You can record the purchase in one of two ways:

• Other Payment – Use this if you paid directly and don’t have a supplier invoice
• Purchase Invoice – Use this if your supplier sent you an invoice

Step two: Use a fixed asset ledger account

When you record the transaction, make sure you select the correct Fixed Asset ledger account. This is important because:

• It keeps your balance sheet accurate
• It ensures the asset isn’t treated as a normal business expense

Default fixed asset ledger accounts

Sage Accounting includes the following fixed asset ledger accounts by default:

If you need to record a different type of fixed asset, create a new ledger account using a similar format.

Next steps

If you bought the asset using finance or part exchange, use one of the guides below:

• Record an asset bought using a loan or hire purchase
• Record a fixed asset purchase with part exchange