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BUSINESS ADVISOR
Stephen Earnhart
Capitalize or Expense That New ENT Scope?
Breaking down the real costs of buying capital equipment.
uying equip-
B
ment is a
major invest-
ment that goes beyond
the sticker price and
negotiations. You have
to navigate the fiscal
permutations regarding how to book the
purchase, not to mention figuring in depre-
THE FINE PRINT The expense of a capitalized microscope is split over several years and deducted from the
revenue it generates.
ciation over the long term.
If all this confounds you, you're not alone. But you don't need to be
an accountant to crunch the numbers. Here, using a recent example
from one of our surgery centers, I'll lead you through the steps —
which apply to hospital and ASC alike — to fully accounting for any
equipment purchase.
So you want to buy …
A new ENT surgeon came on staff, and she wanted a
new microscope. The one we had, of course, was not
what she could use. You know how this story ends:
D E C E M B E R 2012 | O U T PAT I E N T S U R G E R Y M A G A Z I N E O N L I N E
Coming in February:
Balance Sheets
4 1
