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lynfromthed
Level 1

How to record Building (fixed asset) and the current Mortgage balance?

I am setting up new books for a company. They purchased a building many years ago and have been making payments. The building was purchased for (example) $100,000.  Their current mortgage balance is $75,000.  How can I set up the books to reflect the $100,000 building as a fixed asset, and what's left on the long-term note payable of $75,000, so that I can start recording principal and interest payments going forward?

2 Comments 2
Rustler
Level 15

How to record Building (fixed asset) and the current Mortgage balance?

The only option I can see is to book the 25K as an equity investment, but that does not work if the company  is taxed as a C- or S-corporation.  Check with an accountant is the best thing

lynfromthed
Level 1

How to record Building (fixed asset) and the current Mortgage balance?

This is actually for a non-profit church. The church purchased a building over 10-yrs ago and had been making payments. 


@Rustler wrote:

The only option I can see is to book the 25K as an equity investment, but that does not work if the company  is taxed as a C- or S-corporation.  Check with an accountant is the best thing


 

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