There are many finance options available to purchase capital equipment, including:
chattel mortgages: ownership of the item transfers to the business when the lending company pays the supplier of the goods.
hire purchase: ownership of the goods remain with the lending company until the agreement is paid out.
lease agreements: ownership stays with the leasing body and the goods are never owned by the business.
personal loans: these loans are usually from those close to the entity (e.g. directors, family or benevolent friends) and can be treated in the same manner as a chattel mortgage.
AccountRight can be set up to record the specifics of your capital purchase arrangement, but there's a few variables which need to be considered, including:
the terms and conditions of your purchase agreement
your GST reporting basis (cash/payments or accrual/invoice)
We might not be experts in capital purchase arrangements, but our community forum is a great place to connect with business professionals who are happy to share their insights.
Ron Boulton, one of our top forum contributors, has a wealth of experience in this area. Check out his great article on how to record capital purchases and finance in AccountRight.