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Recent Balance Sheet questions

We did a lease to buy on an equipment through a bank and I'm

We did a lease to buy on an equipment through a bank and I'm wondering how we would list this out in QBO for the Chart of Accounts/ Classifications.The bank takes an ACH every month for the repayment of the machine. It's a $1 buy out type of lease.

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Emilee Weaver

Controller

Masters of Professional Accounting

48 satisfied customers
Please read. Some professional at just answer and don't read

Please read. Some professional at just answer and don't read (or understand) my question. Perhaps I don't word it right. I will try to be clear.I have received conflicting answers, is there anyone who can answer this question?BackgroundI own a property management company. I DO NOT own any property myself. I was told by a CPA (at just answer) to apply my rent payments received as follows:Cash $1,000 (debit)………..asset accountDue to Owner $900 (credit) .....a liability accountManagement Fees $100 (credit) ..... income accountThen when I pay the property owner I credit "CASH" and debit "Due to Owner".Here is my conflict:A CPA from just answer told me that the total 1099's that I issue to the property owners at the end of the year, must match my RENT INCOME.(What rent income? I thought I was just told to put rents received in a liability accountI send out 1099's to all of my customers "property owners" for the rents I collected ($850,000).Q: What should the total of the 1099's ($850,000) that I sent out for rents (WHICH ARE NOT MY INCOME) be balanced to on my financial records? - PLEASE don't just say balance the 1099's to your rental income (income account) because I WAS ALREADY TOLD IT IS NOT MY INCOME and the rents increase a balance sheet account as a liability. I am a property manager, not a property owner!Q: It is required that the total 1099's balance to "something" on my financial reports?

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PDtax

Owner

Master's Degree

6,976 satisfied customers
I am working as a bookkeeper for a property management

I am working as a bookkeeper for a property management company. They took an extension for 2015 tax filing, and they want me to compile the 2015 tax information. In 2014 they reported 100% of their "gross rents received" (the rents they collected on behalf of property owners) as income on their tax filing, and then expensed the rents paid out to owners also on their tax filing. The different of the two is their management fees of 10% and the costs they deducted from owners accounts for repairs and maintenance. Is this proper accounting procedures - for a property management company to show rents received on behalf of owners as their own taxable income and then expense the rents paid to owners as expenses on their tax return? (The property management company owns no property of their own)

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Mark Taylor

Certified Public Accountant

Masters

1,228 satisfied customers
I am in the due diligence period of purchasing a business

I am in the due diligence period of purchasing a business and have a question about net profit and projections.There is a current SBA loan that the business pays 60k a year to BUT I cannot find the payments on the P&L. How are payments to a loan accounted for? The P&L shows 14k net profit but if 60k was paid to a loan would that 60 be taken from the 14 and left with -$46,000 in net profit?

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Mark Taylor

Certified Public Accountant

Masters

1,228 satisfied customers
Thank you in advance; My husband and I will retire in four

Hi, and thank you in advance; My husband and I will retire in four years. Our home and all debt will be paid off. My children, mother and our only grandchild live in Michigan, while we live in Louisiana. My husband and I intend to spend 6 months a year in Michigan when we retire.My mother is aging and wants to stay in her home there. (She purchased my large victorian from me when I moved down south.) We are considering paying off her mortgage for her when we retire, and then living on one floor of the home, enabling her to continue living there.There is currently a tenant in the basement apt who has lived there 15 years and pays $600 monthly. Mom lives on the 2nd floor and we would live on the main floor (1500 square feet.) If we did this, eventually we would rent the upstairs apt for about $800 monthly. The house's monthly expenses, including taxes and maintenance, are about $800 monthly.My husband will have retirement of about $50k a year after taxes, and our expenses will be about half of that. We will only be 55, so we will be self-funding our insurance for 10 years. We will have about $200k in our retirement investment, and we would pay off her mortgage of approx $60k from that.Does this seem like a sound investment vs purchasing a Class C RV or renting an apartment every year? We would be absentee owners 6 months a year (during snowy winter months) but our daughter will be available to attend to any issues.Again, thank you for your advice!

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

17,694 satisfied customers
How to add goodwill to exisiting c corp, Selling a business

How to add goodwill to exisiting c corpJA: The Accountant will know how to help. Please tell me more, so we can help you best.Customer: Selling a business goodwill but have no cost basis on books from prior accountantJA: Is there anything else important you think the Accountant should know?Customer: journal entry

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Mark Taylor

Certified Public Accountant

Masters

1,228 satisfied customers
Elkhoshkhany I need to complete a worksheet based on the

For Manal ElkhoshkhanyI need to complete a worksheet based on the information given. It needs the adjusted trial balance, income statement, and balance sheet columns.

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Manal Elkhoshkhany

Foundation classes for MBA

9,262 satisfied customers
We are a technology startup with 4 shareholders. Since our

We are a technology startup with 4 shareholders. Since our balance sheet and P&L have become a mess over the years of R&D, as we start monetization, we'd like to start with a clean slate (a new company), so that we become more likely to receive venture investment.We don't just want to create a new company 100% owned by the current one because that will create double taxation in terms of potential capital gains.We can't pull money from current company and create a new one reflecting current shareholder structure either, because it will create complications since some of our shareholders are big and slow to make decision.The OldCo has $70K in the bank and we want to transfer $50K to the new one, keeping the payroll in the OldCo for the next few months.We want to solve this at the board level (two of the shareholders are at the board and we can take decision quickly). Our alternatives are:1) Create a service agreement between the two companies. OldCo pays NewCo a certain amount in regards ***** ***** its current customers. The problem, since NewCo will be cash-flow positive from day one (unlike OldCo) we will have tax liabilities. The question is, how long can we defer those taxable profits.2) OldCo gets a small percentage in the NewCo for its investment, the rest of the company has the same shareholder structure as the current one. The question how small that percentage can be so that the double taxation impact is minimized.3) OldCo gives NewCo a very flexible convertible note (e.g. converts in the next 200 years) The question is, is this feasible.Please advise regarding the three alternatives listed above, or if you have any other alternative approaches you may recommend.

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PDtax

Owner

Master's Degree

6,976 satisfied customers
This might be a stupid question, but it's one I have been

Hello, This might be a stupid question, but it's one I have been struggling with for along time. I'm a small business owner who uses freshbooks for my book keeping. My American Express and Capital one small biz card is hooked up to it, as well as my bank debit card. Ex: when I make a purchase on one of my credit cards, the transactions shows up in freshbooks, and I categorize it accordingly, Then when I pay my bill for the card I show that in my expense reports as well. My question is this. Am I duplicating the expense report by showing the same expense twice? It shows up once as the actual expense, and then again when I pay the bill as accounts payable. I just want to make sure my P&L's are correct.ThanksJarrett

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Lane

JD, MBA, CFP, CRPS

Doctoral Degree

17,694 satisfied customers
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