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Stock transfer to fixed asset

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Hello,

I want to move asset stock into a fixed assets and depreciate them down but do not want this to reduce the profits or cost of sales.

If I physically wrote off the asset stock codes in sage, this would in turn reduce the cost of sales.  How would I then transfer the value into the balance sheet, would this be done by a journal, would this then reverse the reduction in the cost of sales?

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By the_drookit_dug
25th Nov 2019 13:01

Yes

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RLI
By lionofludesch
25th Nov 2019 13:03

Yes, journal.

Don't worry about it reducing your profits, it won't.

Why are you doing it ? Just asking, like. For background information.

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RLI
By lionofludesch
25th Nov 2019 13:06

Hang on - you want to write off the stock AND transfer it to fixed assets ??

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Hallerud at Easter
By DJKL
25th Nov 2019 13:15

Remember market value and Sharkey v Werhner (1955) 36 TC 275.

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By klambert
25th Nov 2019 13:15

Yes, sorry should have explained a bit more, all of our asset stock has always been booked into stock rather than being a fixed asset, it has sat on the P&L.

Each year we have revalued the stock at a lower amount, we no longer want to do it this way, we want to write off the physical stock items, which will in turn reduce the profit, do I then need to do a journal crediting the stock p&l code and debiting the fixed asset balance sheet, will doing this journal then increase the profit to the original starting position?

Once the asset stock is in the correct place as fixed assets this will be depreciated down in the correct way.

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Replying to klambert:
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By The Dullard
25th Nov 2019 13:24

What's "asset stock" please?

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Replying to The Dullard:
RLI
By lionofludesch
25th Nov 2019 13:29

Quote:

What's "asset stock" please?

Beat me to it......

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Replying to klambert:
Hallerud at Easter
By DJKL
25th Nov 2019 13:33

Stock at year start and year end sits on the balance sheet within current assets as stock. If it is stock it is not a fixed asset if it is a fixed asset it is not stock, you cannot interchange at will unless there is a change in intention re the use of the asset.

So if you hold it to resell or incorporate it into something you then resell it is stock- there is no choice .

Why do you think Fixed Assets is the correct place for Stock?

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Replying to klambert:
Psycho
By Wilson Philips
25th Nov 2019 13:35

What does “sat on the P&L” mean?

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By klambert
25th Nov 2019 13:31

Asset stock, it employee computers, printers, monitors, servers etc

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Replying to klambert:
Hallerud at Easter
By DJKL
25th Nov 2019 13:36

So you have been posting Fixed Asset costs to Stock in error, thus misstating your accounts over the previous years.

What a mess- get an accountant before doing even more damage.

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By lesley.barnes
25th Nov 2019 13:36

They are fixed assets

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By The Dullard
25th Nov 2019 13:38

Check your accounting software to see if it has an "I'm a complete idiot" function. Clicking this will automatically rectify all prior accounting errors.

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Replying to The Dullard:
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By klambert
25th Nov 2019 14:01

WOW!

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RLI
By lionofludesch
25th Nov 2019 13:50

Eh dear.

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