Topic: Convert building materials to fixed asset

We have a building that was just constructed. I want to capture the building as a fixed asset.
There are two ways that I have tried to do this:
1. the first approach is to add the building as fixed asset, and capture the cost of building it as the purchase price.
The problem with this approach is that it will debit/credit the accounts twice. first as revenue/expenditure during the purchase of building materials for constructing the building.

2. the second approach is to capture only the building materials (debit/credit bank/building - under fixed assets). the problem I have notice with this approach is that although the account will balance, the building will not show up in fixed assets register, and depreciation/valuation cannot be carried out on the building.

please what is the proper way to handle this

Re: Convert building materials to fixed asset

Transfer all costs of the building to a suspense account by journal entry from the expense account and then journal a consolidated entry as building asset entry.

Re: Convert building materials to fixed asset

thank you @apmuthu for your response. but It is not really clear to me how to implement this in frontaccounting. Please can you throw more light.
Thank you

Re: Convert building materials to fixed asset

apmuthu wrote:

Transfer all costs of the building to a suspense account by journal entry from the expense account and then journal a consolidated entry as building asset entry.

Hello, I stumbled on the same question of starting to deal with fixed assets and not understanding how to "journal a consolidated entry as fixed asset entry". When I look at GL entries for fixed asset purchase I cannot find any difference with a normal item purchase... I don't understand how to "transfer" items to fixed asset entries, apart from cancelling the purchases and redoing them...

5 (edited by davidwarner 12/24/2022 01:22:17 pm)

Re: Convert building materials to fixed asset

Is this procedure is still same? what is difference between individuals fixed assets and the company assets. As a Istanbul real estate, how we can utilize this for the betterment.