Furniture & Fixtures and Its Depreciation: Codes 0040 & 0041

Desks, chairs, shelving and fitted units are Fixed Assets in the same way machinery or vehicles are — bought once and used for years. Sage keeps the original cost and the depreciation written off it in two separate codes, so the balance sheet shows both.

The two codes, and what each one holds

Code 0040 — Furniture and Fixtures records the cost of desks, chairs, shelving and fitted units bought for long-term use. As a Fixed Assets code it normally carries a debit balance, increased by new purchases and reduced only on disposal.

Code 0041 — Furniture/Fixture Depreciation is the accumulated depreciation contra-account sitting alongside 0040, normally carrying a credit balance. Each year's charge (posted as an expense to code 8002) increases this credit balance, writing the furniture down in value without changing the cost recorded in 0040.

A worked example

Say an office refit costs £9,000 (excluding VAT) in new furniture, depreciated over 9 years on a straight-line basis.

Purchase (code 0040): £9,000 debited as the asset cost.

Annual depreciation charge (code 8002): £9,000 ÷ 9 = £1,000 a year, debited as an expense.

Accumulated depreciation (code 0041): credited £1,000 a year — after four years the credit balance reaches £4,000, so the net book value has fallen to £5,000, while 0040 itself still shows the original £9,000.

Why this matters day to day

Furniture rarely gets tracked as carefully as machinery or vehicles, so it's common for old desks and chairs to sit fully depreciated on the register for years after they've actually been thrown out. Reviewing 0040 and 0041 together periodically — rather than just accepting whatever depreciation software auto-calculates — helps catch assets that should have been written off entirely.