What business accounting category do reference book purchases fit in?
Question by Kevin I: What business accounting category do reference book purchases fit in?
If I have a company and I buy reference books related to the operating of that company how do I mark that in my general ledger? Are the books considered assets or expenses and if expenses, which category might they fall under? Continuing Education? Other Expenses?
Best answer:
Answer by Mary Kay
I would put it in an expense account called Publications or you could use Dues & Subscriptions Expense.
You wouldn’t code it to an asset account because a given book probably don’t cost enough to capitalize and depreciate.
Give your answer to this question below!
If you enjoyed this post, please consider to leave a comment or subscribe to the feed and get future articles delivered to your feed reader.
Comments
Usually I use the dollars spent as a guide to determine whether I should capitalize (make it an asset) or expense it. A few thousand and it should be capitalized. A few hundred and it should be expensed. The next thing is if it is expensed, how often I will use that category. If this purchase is a one or two time thing then I would post to office supplies. If this is a regular expense and I want to keep track of how much I spend in this category then I would create a separate account to keep track of it. You do not want to create new accounts for every little purchase. Your Profit & Loss (Income Statement) will be cluttered with useless information. Keep your Charts of Accounts short and sweet.
Steve R. Grgas, CPA
Presti & Naegele
T: (212) 736-0055 ext. 323
sgrgas@prestinaegele.com
it is an expense. There are a number of ways you can describe it – I use a heading called “information and publications” in my accounts.