Real Estate Accounting Made Easy, 2nd Edition

Real Estate Accounting Made Easy, 2nd Edition

by Obioma A. Ebisike
Released November 2019
Publisher(s): Wiley
ISBN: 9781119626817

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Book description

Grasp the fundamentals of real estate accounting, finance, and investments

Real Estate Accounting Made Easy is just that—an accessible beginner’s guide for anyone who needs to get up to speed on the field of real estate accounting, finance, and investments. Beginning with the elementary aspects of real estate to ensure that you’re comfortable with the subject matter, it goes on to explore more in-depth topics in a way that’s easy to digest.

The book begins with discussions on introduction to the real estate industry and basic real estate accounting. Building on knowledge from the initial chapters, the book goes on to cover the different form of real estate organizations, financial statements such as the balance sheet, income statement, shareholders equity and the statement cash flow, and more.

• Provides theories and practices of real estate from an accounting, financial, and investments perspective

• Advanced transactions are discussed in an easy-to-understand manner

• Content reflects the FASB’s new standards on revenue recognition and lease accounting

• Accounting for operating property expenses, operating expenses reconciliation and recoveries, lease incentives and tenant improvements, budgeting, variance analysis are discussed in detail

• Covers types of financing for real estate acquisitions, accounting for real estate investments, project development costs, and real estate brokerage

• The book also walks you through the financial audit process

If real estate is a new territory for you, fear not! This book helps new auditors, accounting, finance, and investment professionals, and users of financial reports understand the fundamentals of the financial aspect of the real estate business.

Table of contents

  1. Cover
  2. About the Author
  3. Preface
  4. 1 INTRODUCTION TO REAL ESTATE
    1. TYPES OF REAL ESTATE ASSETS
    2. COMMON INDUSTRY TERMS
  5. 2 BASIC REAL ESTATE ACCOUNTING
    1. HISTORY OF DOUBLE-ENTRY BOOKKEEPING
    2. TYPES OF ACCOUNTS
    3. ACCOUNTING METHODS
    4. RECORDING OF BUSINESS TRANSACTIONS IN THE ACCOUNTING SYSTEM
    5. JOURNAL ENTRIES
    6. BASIC ACCOUNTING REPORTS
    7. NOTES
  6. 3 FORMS OF REAL ESTATE ORGANIZATIONS
    1. SOLE OWNERSHIP
    2. COMMON AND JOINT OWNERSHIP
    3. PARTNERSHIPS
    4. JOINT VENTURES
    5. CORPORATIONS
    6. LIMITED LIABILITY COMPANIES
    7. REAL ESTATE INVESTMENT TRUSTS
    8. NOTES
  7. 4 ACCOUNTING FOR OPERATING PROPERTY REVENUES
    1. CONTRACTS WITH MULTIPLE COMPONENTS
    2. LEASE CLASSIFICATION
    3. LESSOR ACCOUNTING OF OPERATING LEASES
    4. TYPES OF OPERATING LEASES
    5. ADDITIONAL COST RECOVERIES
    6. OPERATING EXPENSES GROSS-UP
    7. CONTINGENT RENTS
    8. RENT STRAIGHT-LINING
    9. MODIFICATION OF AN OPERATING LEASE
    10. SUBLEASE OF OPERATING LEASE
    11. NOTES
  8. 5 ACCOUNTING FOR OPERATING PROPERTY EXPENSES
    1. LESSEE MEASUREMENT AND RECORDING OF OPERATING AND FINANCE LEASES
    2. CONTRACTS WITH MULTIPLE COMPONENTS
    3. LEASE LIABILITIES AND RIGHT-OF-USE ASSETS
    4. INITIAL DIRECT COSTS
    5. LESSEE JOURNAL ENTRIES OF OPERATING AND FINANCE LEASES
    6. LESSOR OPERATING PROPERTY EXPENSES
    7. OPERATING COSTS
    8. NOTES
  9. 6 OPERATING EXPENSE RECONCILIATION AND RECOVERIES
    1. MOST COMMON RECOVERABLE OPERATING EXPENSES
    2. MOST COMMON NONRECOVERABLE OPERATING EXPENSES
    3. CALCULATING TENANT PRO RATA SHARE OF EXPENSES
  10. 7 LEASE INCENTIVES AND TENANT IMPROVEMENTS
    1. LEASE INCENTIVES
    2. TENANT IMPROVEMENTS
    3. TENANT IMPROVEMENT JOURNAL ENTRIES
    4. FURTHER COMPARISON OF LEASE INCENTIVES AND TENANT IMPROVEMENTS
    5. DIFFERENCES IN CASH FLOW STATEMENT PRESENTATION
    6. DEMOLITION OF BUILDING IMPROVEMENT
    7. NOTES
  11. 8 BUDGETING FOR OPERATING PROPERTIES
    1. WHAT IS A BUDGET?
    2. COMPONENTS OF A BUDGET
  12. 9 VARIANCE ANALYSIS
    1. SAMPLE OPERATING PROPERTY VARIANCE ANALYSIS
    2. SALIENT POINTS ON A VARIANCE ANALYSIS
  13. 10 MARKET RESEARCH AND ANALYSIS
    1. MARKET RESEARCH DEFINED
    2. MARKET ANALYSIS DEFINED
    3. MARKET RESEARCH: PRACTICAL PROCESS
    4. NOTE
  14. 11 REAL ESTATE VALUATION AND INVESTMENT ANALYSIS
    1. WHAT IS REAL ESTATE VALUATION?
    2. APPROACHES TO REAL ESTATE VALUATION
    3. NOTES
  15. 12 FINANCING OF REAL ESTATE
    1. EQUITY
    2. DEBT FINANCING
    3. OTHER FINANCING SOURCES
    4. TYPES OF LOANS
    5. DEBT AGREEMENTS
    6. FINANCING COSTS
    7. RELATIONSHIP BETWEEN A NOTE AND A MORTGAGE
    8. ACCOUNTING FOR FINANCING COSTS
    9. NOTE
  16. 13 ACCOUNTING FOR REAL ESTATE INVESTMENTS AND ACQUISITION COSTS
    1. METHODS OF ACCOUNTING FOR REAL ESTATE INVESTMENTS
    2. PURCHASE PRICE ALLOCATION OF ACQUISITION COSTS OF AN OPERATING PROPERTY
    3. NOTE
  17. 14 ACCOUNTING FOR PROJECT DEVELOPMENT COSTS ON GAAP BASIS
    1. STAGES OF REAL ESTATE DEVELOPMENT PROJECTS
    2. PRE-DEVELOPMENT STAGE
    3. DEVELOPMENT STAGE
    4. POST-DEVELOPMENT STAGE
    5. NOTES
  18. 15 REAL ESTATE DEVELOPMENT REVENUE RECOGNITIONS
    1. REQUIREMENTS FOR REVENUE RECOGNITION
    2. REVENUE RECOGNITION JOURNAL ENTRIES
    3. REVENUE RECOGNITION WHEN PERFORMANCE OBLIGATION IS SATISFIED OVER TIME
    4. NOTES
  19. 16 REAL ESTATE BROKERAGE ACCOUNTING
    1. REAL ESTATE BROKERAGE REVENUES
    2. BROKERAGE COMMISSIONS IN REAL ESTATE DEVELOPMENT PROJECTS
    3. REAL ESTATE BROKERAGE COSTS
    4. NOTES
  20. 17 AUDITS
    1. AUDIT OVERVIEW
    2. TYPES OF AUDITS
    3. NOTES
  21. Index
  22. End User License Agreement

Product information

  • Title: Real Estate Accounting Made Easy, 2nd Edition
  • Author(s): Obioma A. Ebisike
  • Release date: November 2019
  • Publisher(s): Wiley
  • ISBN: 9781119626817