Set up acquisitions
Acquisition is the initial phase of the asset life cycle. This phase offers the most options for ways to record the acquisition. You can manage acquisitions by using the Acquisition, Acquisition adjustment, and Transfer from reserve transaction types.
An asset acquisition can use the Acquisition transaction type, whether it's an external purchase or an internal posting of self-assembled assets.
You can use the Acquisition adjustment transaction type when the parameter setup prohibits multiple acquisitions or when you need to post part of an acquisition to a special ledger account.
Depending on how you set up the Allow multiple acquisitions parameter, you can activate one or an unlimited number of acquisitions for each asset for each book. You should have multiple acquisitions for each asset when you expect to post multiple transactions that affect the acquisition value of an asset.
For example, when a company purchases a truck and truck body from two vendors, it might record two separate transactions, but the completed truck with both components becomes the actual asset.
To change this parameter, select Fixed assets > Setup > Fixed assets parameters. For multiple acquisitions, select the Allow multiple acquisitions checkbox. If you want only one acquisition for each asset for each book, turn off the Allow multiple acquisitions option.
Record an acquisition
You can record all fixed asset transaction types by using the Fixed assets journal. To use this journal, select Fixed assets > Fixed assets journal. Because of the integration in Finance, you can also make asset transaction entries for acquisitions in the General journal of the General ledger and the Invoice journal of Accounts payable.
Consider the following scenario:
Adventure Works Cycles orders computers for new employees when they sign the employment contract. The accountant at Adventure Works Cycles receives notification that a new staff member's employment has started.
The accountant is responsible for making sure that the fixed asset is created and recorded correctly, and they create the fixed asset for each computer. During processing, the acquisitions manager usually records asset acquisitions when the Purchasing department posts the computer invoice. At the end of each month, the accountant verifies that these acquisitions are correctly recorded by comparing the Accounts payable records to an Acquisition proposal.
The following video shows how to record acquisitions.