Page 314 - Accounting Information Systems

CHAPTE R 6 The Expenditure Cycle Part II: Payroll Processing and Fixed Asset Procedures 285

FI G U R E
6-13 COMPUTER-BASED FIXED ASSET SYSTEM

Data Processing Department Fixed Asset Department

Receiving Accounts
Procedures Payable

Asset Acquisition
Procedures Rec. Disb.
Fixed Asset Report Voucher
File

Enter New
Journal Asset on
Voucher File File
Fixed
Asset
To GL/FRS Report
Procedures General
Ledger
User
Departments
Asset
Maintenance
Procedures Fixed Asset Depreciation
File Schedule
Changes
Enter Asset
Transfer Data
Update
Journal Depreciation
Voucher File and Disposition
FA
To GL/FRS Depreciation
Procedures General Report
Ledger

Asset Disposal Sales or Disposal
Procedures
Procedures
Fixed Asset
File
Disposal
Report
Remove
Journal Asset from
Voucher File Files

To GL/FRS
Procedures General Reports
Ledger

Notice that in addition to the historic cost information, the record contains data specifying the asset’s
useful life, its salvage (residual) value, the depreciation method to be used, and the asset’s location in the
organization.
The fixed asset system automatically updates the fixed asset control account in the general ledger and
prepares journal vouchers for the general ledger department as evidence of the entry. The system also pro-
duces reports for accounting management. Figure 6-15 illustrates the fixed asset status report showing the
cost, the accumulated depreciation (if any), and residual value for each of the firm’s fixed assets.