Fired my CPA! QuickBooks HELP! - Posted by Rolfe Kurtyka

Posted by JPiper on February 15, 2001 at 22:24:41:


When I buy a property it is entered as a subaccount under “Property”…a fixed asset type account. Obviously my cost to buy the property is my initial entry. Then for each expenditure I record it under the same subaccount…which has the effect of increasing the total of that subaccount…basically keeping a running total. You simply debit the property subaccount…ie 123 Anywhere Street…and then credit your checking account, credit card, etc. This does not take class, job, etc. You can pull a report up on the property itself, which will show all expenditures. The problem is that it may not break the expenditures down in ways that you may want them broken down. It may be that with QuickBooks Pro there may be a feature that can add detail here…but I don’t think it is on the standard QuickBooks software.

Once the property is rehabbed, if you rent the property you should set up class tracking. This will track your revenues and expenses by property (class). The reason you can’t use “class” for rehabs is that your “expenditures” are not “expenses” but are capital items…and therefore are property added to your cost basis in the property. But of course once you have the property rented then you will have expenses which can be tracked by class. Reports are available by class as well.

I set tenants up as “customers”. This enables a number of functions that I like and use…like statements, accounts receivable, customer reports, etc. I have various things set up as items, such as rent, late charges, option consideration, utilities, etc. The statement function can be “memorized” by QB so that the information is automatically generated at a particular time of the month…nice for tracking and invoicing if you do it.


Fired my CPA! QuickBooks HELP! - Posted by Rolfe Kurtyka

Posted by Rolfe Kurtyka on February 14, 2001 at 12:43:11:


I recently discovered my QuickBooks Pro accounting system is in chaos. (I hope none of my investors see this!) It’s a long story, I did something stupid, it’s my own darned fault, and now I need to fix it, and fix it pronto. I’m going to try to reestablish and track my books myself (if you want something done right…).

Like many of you, I buy and renovate distressed and foreclosed sfh’s and duplexes. I sell about the half renovations. The rest I refinance and hold as a rentals. My typical renovation runs $20,000 to $40,000, and involves various subcontractors, so there are tons of invoices and payments to track. I intend to continually increase my volume, and desperately need an accounting system I can use and understand.

So far, CPA’s and bookkeepers have not been much help, although I do have several income and expense accounts presently set up in QuickBooks chart of accounts. I know WHAT I want from my accounting system, but have no idea HOW to do it.

Any suggestions on how to set-up and organize QuickBooks in a manner which makes sense for our type of business? By Category? Or Job? Report? Any suggestions will be cherished.

Thanks. Rolfe

Re: Fired my CPA! QuickBooks HELP! - Posted by JPiper

Posted by JPiper on February 14, 2001 at 22:46:11:

I set each property up as a subaccount under Property…a fixed asset account in my balance sheet.

As the property is rehabbed expenditures are entered as debits to this subaccount for the specific property. This of course raises the basis in the property.

If the property is put into use as a rental, I use the class method to track revenues and expenses. Each tenant is set up as a “customer”. I handle charges to each customer as items. I generate statements for each customer that are memorized by QBs, and generated automatically about 10 days before due date.

When a property is sold, whether it is a rental being sold or a rehab being sold, the cost basis in the property is used as “cost of goods sold”, and again is a “class”. Gross property sales is my revenue account, again utilized with “class” tracking.

I would say that most of this is in the QB manual. Some of it is in the help section of QBs for real estate related entities. My manual is dog-earred, but it’s all in there (plus some I undoubtedly haven’t gotten to).

QBs is a fairly convenient program once you get the hang of it. Of course, you do need to have some basic tax and accounting skills/knowledge. Class tracking gives you the advantage of income statement broken down by property.


Re: Fired my CPA! QuickBooks HELP! - Posted by Bud Branstetter

Posted by Bud Branstetter on February 14, 2001 at 20:55:58:

I asked Yeider the question about his set up and further discussed it with one of his trainees. If you are doing 4 or 5 a month then it may well be worth utilizing classes. If you are doing less then Customer/job will be okay. When the lists of customer jobs get too long you know its time to organize as classes to summarize expenses.

Another thought would be to use separate credit cards for each project. It would also tell you which project materials were for.

Re: Fired my CPA! QuickBooks HELP! - Posted by David

Posted by David on February 14, 2001 at 15:58:25:

I had a CPA set up my books for me - prime recommendations were :

-operate on a cash basis (not accrual)
-Minimize the number of accounts and sub-accounts
-Make extensive use of the “class” feature instead of sub-accounts - to distinquish between properties/tenants etc.

All of this should keep you focused on the most basic of quickbook functions - write checks/make deposits/using the register.

I believe the “jobs” function is oriented towards managing piece work for clients, (eg:law firm) where you have to track costs to bill back to them, whereas “class” is oriented towards categorizing your own expenses for such an operation as real estate investing/management.

Re: Fired my CPA! QuickBooks HELP! - Posted by Jay

Posted by Jay on February 14, 2001 at 15:00:20:

You might want to make a call to Yeiter & Co. Their niche is working with real estate investors from all over the country. They are out of Houston, TX. They also have software with a chart of accounts that is set up to merge with Quickbooks. You can get their number and e-mail at

Re: Fired my CPA! QuickBooks HELP! - Posted by Ron (MD)

Posted by Ron (MD) on February 14, 2001 at 14:33:18:


I use QuickBooks for my rehab business.

I think others usually categorize each property as a “class”. I think it makes more sense to call each property a “customer:job”.

I struggled on my own to get QB set up and thought the manual was woefully inadequate (despite my MBA in accounting and finance). I ended up going to the Intuit/QuickBooks website where they have a directory of CPAs, accountants and bookkeepers who will give you QB training. I paid about $500 to sit with someone for several 3-hour periods during which she helped me set things up, and showed me how to do it. It was money well spent.

Basically, you have to put each property, repairs and other property-specific expenses into an inventory account (using “items”). When you sell the property, you recognize the revenue and the inventory gets charged off to Cost of Goods Sold, generating your net income for the project.

I like QB alot, but I personally think it’s a real bear to get it up an running on your own.

Good Luck,

Ron Guy

QuickBooks - Posted by Rolfe Kurtyka

Posted by Rolfe Kurtyka on February 15, 2001 at 20:46:37:


Thank you for your response. When using the method you describe, do you simply keep a running total of all the job cost entries, or do you manipulate QB to give a “project management” type report? I like the method of adding job costs into the asset, but I’m not sure which function to use (class, job, etc) to sort the info into a decent project management fomat.

Thanks again Jim, Rolfe