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Additional Expenses on Properties.

edited November 2013 in Advisor

Clients make some additional expenses on properties like Stamp Duty, Maintenance expenses, Yearly Municipal Tax, etc on properties after purchase.

How to add these additional expenses in Mprofit. Acoounting of these expenses will be very important because over a period of 3-4 years of client wants to sell the property, he has to be aware of exactly how much money he has invested in that particular property.

Comments

  • yes, you can add these entries in the accounting section. You can create a new ledger for things like municipal tax, etc...
  • But how will I know the total expenses I have incurred on a particular house / property.
    At the time of selling a house, i should be able to get more money than I have totally invested.

    Is there a way to show these expenses in PMS system.

    Allocating these expenses in Accounting module is simple.
  • Expenses cannot be tracked in PMS system. You will need to manage them in Accounts. You can capitalise your expenses by passing JVs in accounts, by debiting your property and crediting the expense.
    For e.g the JV related to Stamp Duty can be passed as:

    1) When you make payment for Stamp Duty from your bank:
    Debit: Stamp Duty Expense
    Credit: Bank A/c

    2) To transfer your expense related to your property to the cost of the property:

    Debit: Property
    Credit: Stamp Duty

    Only issue will be here is that your cost in PMS of the property will not match with the closign balance in yoru accounts. This is normal if you pass separate JVs in accounts for any particular asset.

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