Peachtree and rental equipment

Discussion in 'Peachtree Accounting' started by Diane Koers, Jan 12, 2006.

  1. Diane Koers

    Diane Koers Guest

    OK everyone...I need to pick your brains.... Anyone out there dealing with
    rental equipment?

    My client buys equipment then rents it out. They might buy a unit for
    $200.00 so they enter a Purchase / Receive Inventory which puts the unit
    into inventory and gives it a cost. Next they rent it to a hospital for
    $75.00 through an Invoice which removes the item from inventory. This
    totally goofs up the COGS though...because they are selling for less than
    they originally paid.

    A month or so later, they get the unit back from the hospital so they need
    to put it back into stock. Sounds like an inventory adjustment to me...but
    I'm confused what to do about the costing here.

    This cycle can go on and on for the same original unit. can we keep the COGS
    correct. Any ideas?

    Thanks,
    Diane
    www.thepeachtreelady.com
     
    Diane Koers, Jan 12, 2006
    #1
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  2. Diane Koers

    PapaFrank Guest

    Hi Diane
    Technically not an Inventory Item but a working asset !
    I know they are using inventory to track amount on hand ( btw) are we
    talking about IV pumps?
    COGS should not be an issue in my humble opinion.

    "Diane Koers" <> wrote in message
    news:...
    >
    > OK everyone...I need to pick your brains.... Anyone out there dealing
    > with rental equipment?
    >
    > My client buys equipment then rents it out. They might buy a unit for
    > $200.00 so they enter a Purchase / Receive Inventory which puts the unit
    > into inventory and gives it a cost. Next they rent it to a hospital for
    > $75.00 through an Invoice which removes the item from inventory. This
    > totally goofs up the COGS though...because they are selling for less than
    > they originally paid.
    >
    > A month or so later, they get the unit back from the hospital so they need
    > to put it back into stock. Sounds like an inventory adjustment to
    > me...but I'm confused what to do about the costing here.
    >
    > This cycle can go on and on for the same original unit. can we keep the
    > COGS correct. Any ideas?
    >
    > Thanks,
    > Diane
    > www.thepeachtreelady.com
    >
    >
     
    PapaFrank, Jan 13, 2006
    #2
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  3. Diane Koers

    Diane Koers Guest

    Thanks PapaFrank! <sigh> I REALLY need a vacation!!!
    --
    Diane Koers
    www.thepeachtreelady.com
    Co-author Peachtree for Dummies


    "PapaFrank" <> wrote in message
    news:...
    > Hi Diane
    > Technically not an Inventory Item but a working asset !
    > I know they are using inventory to track amount on hand ( btw) are we
    > talking about IV pumps?
    > COGS should not be an issue in my humble opinion.
    >
    > "Diane Koers" <> wrote in message
    > news:...
    >>
    >> OK everyone...I need to pick your brains.... Anyone out there dealing
    >> with rental equipment?
    >>
    >> My client buys equipment then rents it out. They might buy a unit for
    >> $200.00 so they enter a Purchase / Receive Inventory which puts the unit
    >> into inventory and gives it a cost. Next they rent it to a hospital for
    >> $75.00 through an Invoice which removes the item from inventory. This
    >> totally goofs up the COGS though...because they are selling for less than
    >> they originally paid.
    >>
    >> A month or so later, they get the unit back from the hospital so they
    >> need to put it back into stock. Sounds like an inventory adjustment to
    >> me...but I'm confused what to do about the costing here.
    >>
    >> This cycle can go on and on for the same original unit. can we keep the
    >> COGS correct. Any ideas?
    >>
    >> Thanks,
    >> Diane
    >> www.thepeachtreelady.com
    >>
    >>

    >
    >
     
    Diane Koers, Jan 13, 2006
    #3
  4. Diane Koers

    D Drake Guest

    Diane, I use the inventory control to track the item as non-stock. Use
    re-occurring invoicing to bill the rentals. Depreciation entries ( re-occur
    GL ) take care of the COGS which is really a misnomer. If he wants to track
    the # of times an asset has been rented, set the item up as regular
    inventory, use $0 as cost and input some finite number as the item
    amounts... say I rent a unit every month and want to track the number of
    times it's rented for the year...I would purchase or invadjust the item # as
    12, then each month as item is invoiced system reduces QOH by 1. same would
    go for weekly/daily/yearly rentals. Just play with the quanity of available
    items.

    Dave
    "Diane Koers" <> wrote in message
    news:...
    >
    > OK everyone...I need to pick your brains.... Anyone out there dealing
    > with rental equipment?
    >
    > My client buys equipment then rents it out. They might buy a unit for
    > $200.00 so they enter a Purchase / Receive Inventory which puts the unit
    > into inventory and gives it a cost. Next they rent it to a hospital for
    > $75.00 through an Invoice which removes the item from inventory. This
    > totally goofs up the COGS though...because they are selling for less than
    > they originally paid.
    >
    > A month or so later, they get the unit back from the hospital so they need
    > to put it back into stock. Sounds like an inventory adjustment to
    > me...but I'm confused what to do about the costing here.
    >
    > This cycle can go on and on for the same original unit. can we keep the
    > COGS correct. Any ideas?
    >
    > Thanks,
    > Diane
    > www.thepeachtreelady.com
    >
    >
     
    D Drake, Jan 13, 2006
    #4
  5. Diane Koers

    Diane Koers Guest

    Thanks Dave!
    --
    Diane Koers
    www.thepeachtreelady.com
    Co-author Peachtree for Dummies

    "D Drake" <> wrote in message
    news:MqPxf.465901$...
    > Diane, I use the inventory control to track the item as non-stock. Use
    > re-occurring invoicing to bill the rentals. Depreciation entries (
    > re-occur GL ) take care of the COGS which is really a misnomer. If he
    > wants to track the # of times an asset has been rented, set the item up as
    > regular inventory, use $0 as cost and input some finite number as the item
    > amounts... say I rent a unit every month and want to track the number of
    > times it's rented for the year...I would purchase or invadjust the item #
    > as 12, then each month as item is invoiced system reduces QOH by 1. same
    > would go for weekly/daily/yearly rentals. Just play with the quanity of
    > available items.
    >
    > Dave
    > "Diane Koers" <> wrote in message
    > news:...
    >>
    >> OK everyone...I need to pick your brains.... Anyone out there dealing
    >> with rental equipment?
    >>
    >> My client buys equipment then rents it out. They might buy a unit for
    >> $200.00 so they enter a Purchase / Receive Inventory which puts the unit
    >> into inventory and gives it a cost. Next they rent it to a hospital for
    >> $75.00 through an Invoice which removes the item from inventory. This
    >> totally goofs up the COGS though...because they are selling for less than
    >> they originally paid.
    >>
    >> A month or so later, they get the unit back from the hospital so they
    >> need to put it back into stock. Sounds like an inventory adjustment to
    >> me...but I'm confused what to do about the costing here.
    >>
    >> This cycle can go on and on for the same original unit. can we keep the
    >> COGS correct. Any ideas?
    >>
    >> Thanks,
    >> Diane
    >> www.thepeachtreelady.com
    >>
    >>

    >
    >
     
    Diane Koers, Jan 13, 2006
    #5
  6. Diane Koers

    DENISMEGAN

    Joined:
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    Location:
    FARMINGTON HILLS MI
    Rental Income

    Basic rule in accounting, match your revenue and expenses. The rentals are fixed assets which depreciation when rented, so rental depreciation is a function of total rental revenue and sale proceeds. Take the sum of these as a percentage of cost times rental income each month, and that is your rental depreciaiton per month. Even gross margin as a percentage of rental income when rented, and on the sale.





    [
     
    DENISMEGAN, Feb 3, 2014
    #6
  7. Diane Koers

    MrGuinness

    Joined:
    May 11, 2015
    Messages:
    2
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    0
    I wish I could understand the answers here, as I am trying to setup peachtree to do just this right now. What Dave said about recurring invoices doesn't work for me, as it is never the same person renting our equipment. Also, I am not sure I understand what PapaFrank said about setting it up as a working asset instead of an inventory item?

    Could someone spend a few moments explaining specifically which fuction is the best to use for renting out many items that will come back regularly, so that Quantites on hand can be tracked, and also so that all items that are being rented at any one time can be reported on as well as to easily report on what items we currently have on hand?

    Thanks in advance!
     
    MrGuinness, May 11, 2015
    #7
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