financial management information system - National Food Service ...

S UPPLEMENTAL S CHEDULES S ECTION 3Major Equipment/Furniture PurchasedDefinitionsCapital Equipment/FurnitureThis item refers to an expenditure for durable equipment or furniture over a specified dollar amount, as defined by thestate, with a life expectancy greater than one year. It is recorded to a fixed asset account. Items may include major foodpreparation equipment, refrigeration equipment, serving line equipment, copying machines, fax machines, computerhardware, dining room tables/chairs, office desks, etc.Equipment, Leased/PurchasedThis category covers equipment initially leased for a contract price. When the lease is fully paid, the equipment becomes theproperty of the school district.Equipment, LeasedThis line item is for payments to use equipment that will be returned to the leasing agent when the lease expires.N OTEThe NCES Financial Accounting for Local and State School Systems, 2003Edition proposed a set of criteria for distinguishing capital equipment fromsupply items. An equipment item must meet all of the criteria. At the first“no” the item is declared to be a supply, not equipment.Criteria for Distinguishing Equipment from Supply Items1. Lasts more than one year2. Repair rather than replace3. Independent unit rather than being incorporated into another unit item4. Cost of tagging and inventory small percent of item cost5. Exceeds minimum dollar value mandated by state or other governmental unit59N ATIONAL F OOD S ERVICE M ANAGEMENT I NSTITUTE