Asked in Business Accounting and BookkeepingReal EstateReal Estate Buying and SellingReal Estate InvestingFinancial Statements
How is work in progress properties reported by real estate developers in financial statements?
April 30, 2013 7:44PM
We use job cost accounting software to track the costs by project. The costs are posted from the JC system to an asset account in the GL called "Work in Progress". When the job is complete, we move the costs from the WIP account to a capitalization account called "Completed Projects". This account contains subsidiary accounts for each project. Once the project is completed and we begin leasing and operating it, we can start depreciating the property.