In-Kind payment

"Dan S." wrote

So......

You use church owned equipment to perform services at said church, presumedly these services are for the church and/or it's members. Why are you wanting to book revenues and expenses for? Seems like a waste of time, not to mention misleading to users of the financial statements.

Paul Thomas, CPA has brought this to us :

No, I use their equipment in my business away from and off of church property for profit. It is a signed lease. Before I signed the lease, I received $35 a week for my services .. now, I get to use the equipment (a lawnmower) whenever I want.

Paul Thomas, CPA expressed precisely :

So, that's it. No real advice. Are you bitter about something?

"Dan S." wrote

I'm not bitter. Just waiting to see if someone else would chime in with a different perspective.

There's no real reason to book revenues you didn't receive and expenses you didn't pay. The net result is zero, so why bother. In my view, posting those entries could be misleading to someone who sees your financials. Think Enron. They were booking revenues that didn't exist.

I'll chime in but with the same perspective. Maybe the OP thought there would be tax advantages or something to justify booking the entry.

John laid this down on his screen :

Yes, that is part of it. The rest I was thinking would be in analysis ratios. It was work done. Although the money never changed hands, its value 'flowed' through the business, so to speak.

What is the reasoning behind increasing an asset account for stuff that isn't yours?

Oh. Sorry, should have explained. It goes straight from revenues to expenses. I have a Tools and Equip in both assets and expenses. When I buy something with residual value, I move it to assets.