You can dispose of an asset in the AutoRec Depreciation Module before the end of its term and calculate gain or loss by navigating to the Assets tab, ticking the box next to the item on the Assets page, and clicking on the Dispose button:
Note: You can select more than one asset if they’re being disposed of on the same date. FloQast will generate one consolidated journal entry that includes a line for each individual asset, while aggregating the total sales proceeds and total gain/loss across all disposed items.
The disposal modal will pop up, allowing you to fill out the details. More information can be found in the screenshot below:
Note: Enter only the relevant account number into the Gain/Loss Account and Sale Proceeds Account fields, instead of the account name.
After clicking the Review button, you’ll be presented with a summary of the disposal showing the original cost, accumulated depreciation up to the current period, the sales amount (if applicable), and the calculated gain or loss:
Note: The gain or loss is automatically calculated via the following methods:
- Disposing without a sale: Cost - Accumulated Depreciation = Loss or 0
- Disposing with a sale: (Cost - Accumulated Depreciation) + Sales Amount = A positive gain or a negative loss
If you're integrated with NetSuite, QBO, or Intacct, you will have an option to create a journal entry for the disposal:
Note: There are setup steps required for journal entry posting to work; see this article for those steps and what it looks like after the JE is created.
You can then click on the Save or Dispose with Journal Entry button to finalize the disposal and create an entry for the asset on the Disposals tab. This will also gray out the existing asset on the Assets tab so it can no longer be edited.
When the Excel Export is downloaded, it will include the journal entry for the disposal on the Journal Entry tab. The journal entry will correctly debit the accumulated depreciation and sales proceeds account and credit the asset's cost, with the balancing debit or credit being the calculated gain or loss.
You can restore disposed assets by navigating to the Disposals tab, ticking the box next to the asset, and selecting the Restore button. If you restore one asset that was part of a bulk disposal, all of the assets that were selected during the disposal will also be restored.
If you're integrated with NetSuite, QBO, or Intacct, you will have an option to create a journal entry for the restoration.
Note: There are setup steps required for journal entry posting to work; see this article for those steps and what it looks like after the JE is created.
When the Excel Export is downloaded, it will include the journal entry for the restoration on the Journal Entry tab, like the disposal entry listed above.
Frequently Asked Questions (FAQ)
Q. How is Accumulated Depreciation calculated for the disposal?
A. The Accumulated Depreciation amount used in the disposal calculation excludes the current month’s depreciation.
Q. What happens to the disposed asset in the Disposals tab?
A. The Disposals tab now shows the Net Book Value (NBV) of the disposed asset instead of its original cost, providing a more accurate view.
Q. Why can’t I dispose of a specific asset?
A. You are unable to dispose of an asset if it’s already expired (i.e. the current period is past the asset’s end date or useful life). Please check if the asset is still active.