Fixed assets in the process of operation are subject to wear and tear, become obsolete morally and physically, bought, sold, exchanged, transferred for various reasons to third parties. The disposal of fixed assets in organizations occurs as a result of:
- Sale of fixed assets
- Accident, natural disaster, theft liquidation
- Write-offs, in connection with their further unsuitability
- Transfers at no cost
- Lease of fixed assets
- Contribution to the authorized capital of a third-party organization
In order to determine the feasibility of the unsuitability of the fixed asset, a commission is created, which includes equipment specialists, engineers, and the chief accountant. They inspect and establish the reason for the write-off of the fixed asset, identify the perpetrators, consider the possibility of further use of the details of the decommissioned object, monitor the removal of precious metals from them. Then they draw up an act of cancellation, which is signed by the members of the commission, approved by the head and transferred to the accounting department.
The main operations for the disposal of fixed assets reflect the write-off of the object at its original cost. When selling an object, the residual value, the amount of depreciation accrued, are deducted, the amount of VAT from the proceeds is taken into account, when exchanging, liabilities are offset at the contractual value. The accounting entries reflect the write-off of the residual value, the amount of accumulated depreciation and all costs associated with the disposal of the fixed asset during the write-off, liquidation and gratuitous transfer.
So, on account 01, the accountant allocates subaccount 01/1 — disposal of fixed assets and makes entries: D-01/1 K 02 0 for the amount of accrued depreciation and D-01 K 01/1 for the amount of the initial cost. Then, on account 01/1, the residual value of the fixed asset is accumulated, which upon disposal is debited to account 91.
When selling and leasing fixed assets, the result from the disposal of fixed assets will credit the proceeds from the sale to the profit account.
The disposal of fixed assets takes into account the remaining material values after the dismantling and dismantling of the object. Materials come at market prices. When writing off fixed assets after accidents, fires and other natural disasters, it is necessary to take into account that part of the losses are reimbursed at the expense of insurance companies, at the expense of reserve capital and at the expense of those responsible for thefts or shortages.
The disposal of fixed assets by primary documents is drawn up - an act to write off OS-4 during liquidation, write-off due to the impossibility of its further use. Upon sale, transfer to the authorized capital, upon free transfer of fixed assets as a gift, an OS-1 acceptance-transfer certificate is drawn up. When you return the leased object and when moving inside the shops and other departments of the enterprise, an invoice for internal movement is filled, but such movements are not a disposal of fixed assets.
The disposal of fixed assets always requires additional costs, which are recorded in the form of expenses operations and are collected on account 23, or immediately on account 91. That is, for the credit of the account 10, 68, 69, 70, and for the debit account 91, subaccount other expenses. All operations related to profit from proceeds from the sale of objects are reflected in accounts 50, 51, 62 for debit and 91 for credit in the subaccount other income.
Both income and expenses on disposal of fixed assets are always reflected in the current reporting period. On account 91 is collected the financial result from the disposal of objects in the organization. If the credit of the account is greater than the debit, then the company has a profit, and if less - a loss. The financial result from the disposal of fixed assets from account 91 at the end of each month is debited to account 99.
When fixed assets are disposed of, an appropriate note is made in the inventory card on their deregistration. Cards are kept at the enterprise for at least five years.