Setting up accounts to show expenses and assets

SUGGESTED

We are in the final stages of building a house that we will rent out. I have set up a project to track expenses and revenue, but not entirely sure on the accounts to use.

Would I set up an expense account for appliances 5115 and an asset account 1840?

I am totally lost on this. 

We will be having separate expense accounts for Furniture, appliances and Equipment.

I will have to show rent that we collect as revenue as well.

Any help is appreciated !!

  • 0
    SUGGESTED

    Hi Janchristie:

    Initial costs for appliances and furniture should be shown as assets and amortized over the life of the assets depending upon its classifications. To track expenses and revenues it is just a matter of assigning accounts to be allocated to projects. Create your Project for the rental property. After that, when processing transactions which relate to the rental property they need to be allocated to the project.

    Hope this helps!

  • 0 in reply to Agate

    Thanks, So to make sure I am doing this right I make an asset account showing the purchase price of the house account 1840, we paid cash for it so no mortgage and another account 1842 to show depreciation? and do the same for furniture and appliances? 

  • 0 in reply to Janchristie
    SUGGESTED

    Hi Janchristie:

    I would suggest creating an accumulated amortization/depreciation house and furniture & appliances accounts along with sub accounts for each which show a net value of the asset minus accumulated amortization/depreciation.

    Hope this helps!