Splitting Real Estate Rent Income Transaction with a Bill

DanPropertyDanProperty Member Posts: 3

I've seen some similar questions asked here, but still struggling to make this work in Wave.

Example:

  • Rent: $1000 (tracked via invoice)
  • PM Management Fee: $100
  • PM Repairs & Maintenance Costs: $55
  • Bank Deposit: $845

I've got an expense category for "Management Fee" and a separate expense category for "Repairs & Maintenance Costs", however the Split Transaction functionality doesn't let me link to an Expense category.

The closest work around I can get is creating a separate "Payment Processing Fee" called "Maintenance Deducted from Invoice" which will allow me to split the transaction against the invoice and these other expenses.

Is there a way instead to split a transaction between and Invoice and a Bill? Or perhaps I'm just doing this entire process wrong.

edited October 18, 2021 in Accounting Technical Support

Comments

  • DanPropertyDanProperty Member Posts: 3

    @JordanD I noticed you commented on similar posts. Any suggestions here?

  • HelpIfICanHelpIfICan Member Posts: 16

    As far as I know, there is no way to split a transaction the way you want when it involves an invoice. It goes against accounting principles. You only have one option as far as I can see.

    Print out the invoice and then delete it. Make a journal entry. Make sure you reference the printed invoice in the journal entry.
    Debit:
    Bank deposit
    PM Management Fee
    PM Repairs and Maintenance Costs

    Credit
    Rent Income

    This is not a split transaction. These are just multiple lines in a journal entry. Make sure you check More and then Make a journal entry, not add income, not add expense.

    Also, your amounts do not add up. You're over by $10. Make sure you recalculate.

  • DanPropertyDanProperty Member Posts: 3

    Thanks for your suggestion @HelpIfICan. Trying to avoid Manual Journals if possible and definitely avoiding printing things :smile:! Adjusted the Bank Deposit in my example thanks for spotting that.

    Invoicing a party who also sends bills to you is very common in the business world and paying the net difference is also very common. I'm also trying to migrate away from a software that has this functionality already built, so it's not outlandish to think this should be possible in Wave.

    A non-tech solution is I've asked the property manager to separate this into two transactions, a deposit and a withdrawal. That would make it easy to account for.

    edited October 18, 2021
  • HelpIfICanHelpIfICan Member Posts: 16

    I don't actually send invoices or use the app to receive bills. I just use it to record transactions that have already happened, for the most part, so I don't mind the occasional journal entry. If you're manually entering the invoices, then why not add an -A and -B to the invoice and to the bill and keep the invoice separate from the bill?

    You have to print things sometimes. You never know when you might get audited. They may want to see hardcopies.

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