Help with a same as cash purchase

[John R. Sowden]

On 08/27/2013 07:32 AM, Donna Pfeifer wrote:
> I have a small, one person business and am doing my own bookkeeping. I've never done any DE work but I think I have the gist of it.
>
> I purchased a new high end computer for my business on a 18 months same as cash basis. I made no down payment as it was all placed on a new credit card opened for that specific purpose. I am making payments of $200 a month.
>
> What is the proper way to enter this?
>
> It also needs to be depreciated. I am working on figuring that out. It looks like, for the U.S.A., it would be a 5 year depreciation using MACRS/GDS.
>
> Thanks in advance!
>
> Donna
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Purchase of Computer:
Debit Asset Computers (or Office Equipment)   $3,600.00
   Credit  Liability Visa Credit 
Card                                             $3,600.00

Making Payments:
Debit Liability Visa Credit Card 200.00
   Credit Cash 200.00


Purchase Price (Including sales tax, installation, etc.)    3,600.00
   Less Salvage Value (Hold until asset is disposed of)        360.00
Depreciable Base 3,240.00
Monthly depreciation (3240/60):                                          
54.00
Quarterly Depreciation (54 x 3):                                        
162.00

Depreciation:
(I post my depreciation quarterly)
Debit Expense Depreciation-Computers                162.00
   Credit Contra Asset Acct Accumulated Deprec                           
162.00

I think I got it all.

John