I use Proseries Plus. I am preparing a 1065 partnership for the partnership's first filing. They had $165K of investment income. This was cash out of pocket not a loan. They do include this correct? If so, where should it be entered in the software for the 1065 Partnership. So, simply my two questions are:
Do I include the $165K cash investment
If so, where is it entered in the software.
Thanks for any advice.
Lynnetta
You seem to be confusing Cash Flow, with any and or all the reasons cash might be flowing.
You used the word "cost" but can you think of what got purchased?
You used the word "asset" and that would be something of value that is going to last a while, and is still on hand.
Example: money spent on stamps and printer paper are office expense; they get all used up. But money paid to buy a drill press, means that is invested in a piece of equipment that has a useful life and doesn't not get all used up by just making one hole.
You used the phrase "fixed asset" but you need to learn about asset types, asset classes, useful life, and which tax rules apply to which assets.
Money is an asset. If you put money into your entity's bank account, there is no Cost, nothing got Spent, not an expense, and nothing got bought. The money didn't drip away while being moved. It is not all used up. It is on hand. It is an asset. The next point to determine is:
where did the money come from?
Loan (which makes it a liability to be repaid) or part of the owner(s) investment into their own entity (which is their Equity or ownership position).
And they fact that you treated all of those words (and then some others) as if they are interchangeable is what has everyone worried. You will not be fair to your clients, if you continue to do this without a mentor, some training, etc.
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