My boss got a 20,000 check deposited for the sale of a property. I don't know how to record this deposit. I know the one side is the bank account but what is the other side? There is no asset account for the property so I am not sure what the other side of the journal entry should be. Can someone help me with this?
When you say "property", you mean real property, yes? Is this land? Was the property owned by the company or your boss personally? If it was owned by the company, did the company pay for it? It sold for only $20K so is it possible your boss traded for it or was given the property somehow?
This is a rental house that got sold. It was owned by the company. The company didn't pay for it there was a loan but the loan was defaulted on and closed. Nothing was traded or given in exchange.
It was a rental house, and it was owned by the company but there was a loan, and it was defaulted on. Nothing was given in exchange or traded, the one owner was relieved of duties in company and other owner sold the property to close the company.
I think you need the help of a good CPA/tax accountant on this one. The property should have been listed an asset on the company's balance sheet with accumulated depreciation. Without that, there's no way to know the nature of this $20K. In the meantime, I would assign the deposit to 'Ask My Accountant' and let them figure it out. Just my $.02.
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