The subject of Fixed assets have a time frame of useful life for at least 1 year and must be used in the operations of the business.

The Fixed Asset account refers to items that have a useful life of at least 1 year and are of a specific dollar amount determined by your Financial Policies and Procedures and recommended by your tax preparer.  There is no set dollar value to determine what a fixed asset is, which could be as low as $1.00, up to $5,000.00 and beyond.  These fixed assets stay on your GL for the duration that they are property of the company, even if they have lost their purchased value through depreciation.

Examples of this type of account include: buildings, computer equipment, vehicles, and land.  Leasehold improvements such as a new heating and cooling system you purchase for a leased office space can be tracked as a fixed asset, if it meets the guidelines of the value and useful life pre-determined from your company’s policies. 

In the case of Land, it cannot be depreciated and cannot lose its purchase value unless it has been determined through a legally recognized outside source and is recorded properly in your General Ledger of Accounts.

I hope this helps.  Check out our QuickBooks classes in the Houston area.