I understand your reply of repair versus capital expense so my question must not have been clear…
When I buy a house to resell that will need some repairs, these repairs are a capital expense as the property is not in “service”.
To properly see my cashflow in Investor Books PRO when I do a report, I put these fixup costs as an expense (initially). I do this under “repairs and maintenance”
The fixups will eventually be transfered and recharacterized as a capital expense at a later date thus in the meantime allowing my cashflow report to provide useful information for me as an investor.
My question is when do I transfer this to the asset?
Thank you Mike,
Hope that is more clearer-er
Great Question Steve! This is probably one of those questions most investors are afraid to ask.
For starters, as an investor and business owner, YOU MUST KEEP YOUR FINGER ON THE PULSE OF YOUR BUSINESS! – No Exceptions! No longer can you borrow your way out of a cash flow problem.
Knowing this up front, you MUST be able to push a button and see a real, true blue, “cash flow” report.
This “Cash Flow” report drives many bookkeepers, accountants, and CPAs BONKERS because they have been trained to keep your books in Ready For Tax Time fashion. Their professionally trained method makes it totally impossible to generate a true “Cash Flow Report.”
Keep in mind, the way they do your books is proper for tax time; however, you and I have not been trained in their 5 star bean counting arena.
The simple version is Investor Books PRO makes it simple and easy for investors and business owners.
ALL of your capitalized “expenses” get entered using the Click to Access Video or Read More