How Do I Account for the Money I've Contributed to my Business?

I started a small retail business a couple of months ago, my first business venture, so I'm new to accounting. The business is a sole proprietorship
LLC. I'm using QuickBooks Pro 2006. How do I enter all of the funds I've spent from my personal account to start the business? The expenses include the down payment on the building mortgage, remodeling costs, and my initial inventory.
Thanks, SW
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Well..........
None of what you indicated is a current expense.
The deposit is an asset that, you hope, you will get back one day.
The remodel costs are also an asset that you get to depreciate over like 39 years (sooner if you move).
The inventory is also an asset and doesn't get expensed until you sell it.
And you'll have at some point, asset costs for furniture, fixtures and equipment that get depreciated over 3, 5, or 7 years.
But, the entries would be to record the assets (as debits) and the balancing entry (a credit) would go to owner equity (it's an equity account).
It might be wise to get some books on basic accounting, or take a bookkeeping class from a local college and their continuing education program.
It also might be good to talk to a local CPA or EA for accounting guidance and especially with tax help.
--
Paul Thomas, CPA
snipped-for-privacy@bellsouth.net
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You blew it ! Your FIRST MAJOR mistake!
Number ONE thing in Business if you don't have the Money then you CAN'T afford it! period! You borrowed the $$$ now you have a mortgauge! you are now a SLAVE to who ever holds the mortgauge!
Borrower is SLAVE to the lender!
You have Re-modeled a building that is OWNED by someone else! [lender] that is NOT good business!! what you have done is make it nice for the next 'purchaser' or for the lender when they take it back if you default!
Things in ths nation are getting WORSE every day! The Bimbos and paid SHILLS on TV want you to think things are 'better' The stock market is up ( PUMP AND DUMP) but just monitor the job losses all across this nation! the so called Job's that are created are for the most part low paying CRAP jobs!
After the elections, and if Bush gets us involved with another ZIONAZI war in the middle east ( We have become a NATION OF IDIOTS, we are Destroying ourselves for Israel) Gas will ZOOOOOOM up to 5 bucks ++ a gallon! just watch how fast red ink flows! and the stock market tanks!
Hope I am wrong but don't think so! our nation is in SERIOUS trouble!
Paul Thomas, CPA wrote:

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wise purchaser wrote:

This person is clearly crazy.
Have wise purchaser, tell me the difference between good debt and bad debt?
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New Cassandra wrote:

Greetings!
DEBT is DEBT! : borrower is SLAVE to the lender!
I see this stuff all of the time, People with a pipe dream they buy a local building full of lead paint, asbestos, crappy roof, under powered heat / air conditioning systems, they go into 'good debt' purchasing it, Then the 'fun' starts, they find out that THEY have to remove the abestos, make the building ADA compliant, meet the fire codes, find an underground leaking heating oil tank, the clean up $$$$ they fix up the clap trap building with a 'good debt' home equity loan then open for business only to DIE a slow death till they go BROKE !
A short time latter you see thier home FORCLOSED upon and the bank walks away with every thing fixed up real nice, and with EVERYTHING the poor dreamer worked for! for pennies on the dollar then the cycle repeats! another 'good debt' DREAMER..buys the building.....
So much for 'good debt' If you have to borrow money for anything then you cannot afford it period!
You give a BANK 20 grand a year in interest so you can deduct 5 grand or so ??? tell you what, I will KEEP the 15 grand for myself and give the 5 grand to the IRS!
'Good debt' is paying for a building (or a home) over the life of the loan three times its worth in interest !
And now you see why banks are doing so well!
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On 31 Oct 2006 16:57:16 -0800, "wise purchaser"

So what do you advocate for a person who, for example, can't afford the entire purchase price on a home avoiding a mortgage? Should they rent while saving their pennies? That's bright. Pay someone ELSE'S mortgage while THEY deduct the measly deduction for interest and build equity while YOU have NOTHING. Beverly
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wise purchaser wrote:

Ever heard of the saying, "if you owe the bank $100,000 it's your problem. if you owe them a $10,000,000 it's their problem". What I am saying is banks earn their profits by taking the risk of lending to possibly non credit worthy customers - that is why they have bad debts.
You sound like a fundamentalist churchie. Why not have the guts to call it usury, and accuse the Jews of using interest to undermine Christians?
In our capitalist western society, with government regulation, we are talking about contracts and the rule of law here.
Listen Braniac. I want to buy a house for $200,000. I need to borrow $150,000 to do this at market rates from (say) Citibank.
In 20 years time the property will be worth $1,000,000. I may have paid out $450,000 in principal and interest over this time to pay back Citibank.
I am clearly in profit. I have sacrificed some present earnings to benefit in the long term.
what is the alternative? - Rent the property and over 20 years most likely I would have paid out twice the loan repayments as rent, and still have no asset at the end of the 20 years.
Slavery was abolished in your country during the Civil War. It never existed in my country.
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what abt building a small energy efficient home that one can pay off in say 5 years instead?
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I have a client that did just that. Total cost of the building, $150,000. It's one bedroom, one bath, about 1000 sf. Runs off of solar primarily. He paid cash, but I doubt the average person can pay off a $150,000 note in 5 years, nor do I believe that a family of more than two are willing to live in a one bedroom house.
--
Paul Thomas, CPA
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wrote:

So it had a total of ho many rooms?
And..cant it be done smaller and cheaper than that?
I don't understand this thing in the US where all homes of several thousand sq feet
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Upstairs/main floor was one room. Down stairs/partly sub-teranian was bedroom, bath and a few closets/storage area. Total of about 1000 sf

I'm sure it could be, but low energy appliances aren't cheap, and neither is using renewable source building materials (bamboo, etc) where possible and practicle.

I know a single guy who is building a 14,000 sf house for himself.
--
Paul Thomas, CPA
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snipped-for-privacy@privacy.net wrote:

Why not try answer my question instead of trying to change the subject ;-P
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You blew it ! Your FIRST MAJOR mistake!
Number ONE thing in Business if you don't have the Money then you CAN'T afford it! period! You borrowed the $$$ now you have a mortgauge! you are now a SLAVE to who ever holds the mortgauge!
Borrower is SLAVE to the lender!
You have Re-modeled a building that is OWNED by someone else! [lender] that is NOT good business!! what you have done is make it nice for the next 'purchaser' or for the lender when they take it back if you default!
Things in ths nation are getting WORSE every day! The Bimbos and paid SHILLS on TV want you to think things are 'better' The stock market is up ( PUMP AND DUMP) but just monitor the job losses all across this nation! the so called Job's that are created are for the most part low paying CRAP jobs!
After the elections, and if Bush gets us involved with another ZIONAZI war in the middle east ( We have become a NATION OF IDIOTS, we are Destroying ourselves for Israel) Gas will ZOOOOOOM up to 5 bucks ++ a gallon! just watch how fast red ink flows! and the stock market tanks!
Hope I am wrong but don't think so! our nation is in SERIOUS trouble!
Paul Thomas, CPA wrote:

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wrote

business
I've
include
initial
39
balancing
Quickbooks has a help section that explains using personal funds for a business and there are QB forums such as news:alt.comp.software.financial.quickbooks but at this point your best option may be to talk with a local accountant before year-end because there are tax as well as bookkeeping implications if you mess things up.
.
--
Posted via a free Usenet account from http://www.teranews.com


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Along with the other great comments here I would meet with you CPA. Have your CPA review your chart of accounts to make sure you are showing expenses appropriately for your business and for your tax return. Have your CPA to set up this entry for you.
You have to set up the full price of the building (downpayment and mortgage) as well as setting up the liability for the mortgage and depreciation. The remodeling costs need to be reflected in all of this calculation.
Involving your CPA for this initial set up will help relieve some frustrations from you and it will help your CPA when it is time to do your year end and your tax returns. It is much easier to set it up right at the start than the fix it later. TK
Summer Wind wrote:

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