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Depending on how these entries are typically recorded in QuickBooks, mortgage expenses are a balance sheet transaction and aren’t classified as income or expense, Ivett1.
Principal payments aren’t considered expenses as it simply shifts money to reduce the liability and cash balance. Thus, this is recorded on the Balance Sheet report as a reduction to your loan.
With that, the interest portion of a mortgage payment is considered a legitimate expense and will reflect on your Profit and Loss (P&L) report. Also, if you’ve assigned specific classes and have categorized this transaction, accurate expense data will appear on your P&L by Class report.
However, if these are only impacting the liability account and not the interest expense account, they won’t show up on the Profit and Loss report.
Thus, to ensure accuracy, I suggest reviewing your transactions. Verify that the interest portion is categorized as an expense and that principal payments are recorded under the liability account for your mortgages.
In addition, you can run a Transaction Detail by Account report and filter by class. Doing so will help you check if the relevant expenses have been assigned to the appropriate classes.
If you require further assistance, leave a reply in the comments below.
