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Assets, stock valuation & cost of inventory
I'm trying to understand how various asset and stock-related figures should be entered in the software.
For fixed assets, should the asset value and depreciation be entered separately, or does TinyTax adjust the asset value automatically? For example, if I purchase a laptop for £1,000, should I enter £1,000 under "Fixed Assets" and at the same time enter £333 under "Depreciation and other amounts written off assets"?
For stock, should closing stock be included in Total Current Assets, and is Total Current Assets generally made up of bank balances, cash, debtors and closing stock? If some inventory is damaged, obsolete or otherwise written off, where should that be reflected in the software — for example, should it affect only the closing stock figure, or should it also be reflected elsewhere (such as "Cost of raw materials and consumables")?
Also, if inventory purchases incur processing fees directly related to acquiring the stock, should those fees be included when calculating both "Cost of raw materials and consumables" and the value of unsold stock included within Total Current Assets?
Thanks
For fixed assets, should the asset value and depreciation be entered separately, or does TinyTax adjust the asset value automatically? For example, if I purchase a laptop for £1,000, should I enter £1,000 under "Fixed Assets" and at the same time enter £333 under "Depreciation and other amounts written off assets"?
For stock, should closing stock be included in Total Current Assets, and is Total Current Assets generally made up of bank balances, cash, debtors and closing stock? If some inventory is damaged, obsolete or otherwise written off, where should that be reflected in the software — for example, should it affect only the closing stock figure, or should it also be reflected elsewhere (such as "Cost of raw materials and consumables")?
Also, if inventory purchases incur processing fees directly related to acquiring the stock, should those fees be included when calculating both "Cost of raw materials and consumables" and the value of unsold stock included within Total Current Assets?
Thanks
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Fixed assets and depreciation
The Fixed Assets field on the balance sheet takes the net book value — cost minus all accumulated depreciation to date. So yes, you enter them in two places:
- Balance sheet, Fixed Assets: net book value at the period end. For a laptop bought for £1,000 with £333 depreciation charged this year, this would be £667 (not £1,000).
- P&L, Depreciation: the current period's depreciation charge — the amount by which assets reduced in value during the year, which would be £333 in that example.
TinyTax does not calculate depreciation for you — you provide both figures from your prepared accounts. The depreciation charge in the P&L is automatically added back in the tax computation, since it is not allowable for tax purposes.
Closing stock and current assets
Yes, closing stock goes into the Total Current Assets field, combined with bank balances, cash, and debtors. TinyTax uses a single Current Assets field for all current assets — there is no separate stock field. Add everything together (bank + debtors + closing stock) and enter the combined total.
For damaged, obsolete, or written-off stock: the closing stock figure in Current Assets should reflect the net realisable value (what the stock is actually worth after the write-down). The write-down itself flows through Cost of raw materials and consumables in the P&L — it reduces your closing stock and increases your effective cost of goods sold by the same amount. You do not need a separate line for the write-off.
Processing fees on inventory
Yes, costs directly attributable to acquiring the stock (like processing fees) form part of the cost of that inventory. Include them in Cost of raw materials and consumables when calculating total cost of goods sold, and include them in the closing stock value for the unsold portion in Current Assets.
The practical formula: opening stock + purchases + direct acquisition costs - closing stock at cost (including fees) = Cost of raw materials and consumables.
This is consistent with stock valuation under FRS 105 for micro-entities.