In this sample book Terra Nova does the administration of apartment rentals.
The concept of the book sample book is simple. Terra Nova charges a fixed fee to track rent receival, expenses related to the property (maintenance, gardening, cleaning, etc.) and the renting service itself (legal, accounting, etc) compensating operations against an outstanding account with the landlords.
The Bkper sample book for Terra Nova
For didactical purpose the sample is kept simple with a Chart of Account that represents two properties each with three tenants and the Transactions on this book only refer to one property. You can easily scale this by adding property, tenants and landlord accounts to your own copy of the book.
Difficulty for a company such as TN is to "separate" their own business operations from those that correspond to the property rental.
In the flow below the (fictitious) line separates Terra Nova's business operations and below it are all the operations related to property rent, expenses and payouts.
Description of the transactions in this sample book.
1 At the beginning of the month receivables for Rent and Fees and the payables for the landlords are recorded.
On the second of August The Balance value of the receivables of the apartments shows how much is due for each one of them. The Fee is booked against our liability with the Landlord so we owe the landlord 5500 on the second of August.
2 A few days later the tenants pay the rent
The balance value for the receivables for each apartment at this point are zero (0) meaning no values are due on behalf of the tenants.
In case a tenant delays the payment, the receivable will continue to show a positive value making it easy to track due payments.
3 A tenant makes an expense that corresponds to the Landlord
The expense is booked against the landlords receivable.
The balance value of the receivable for the tenant becomes negative.
The next month the rent is booked in, but the receivable deducts the paid expense in the previous month.
Note: The balance value of 1 Apartment shows (300) negative because the date for the balance sheet is 08/31/2021.
4 Terra Nova makes an expense that corresponds to the Landlord
Terra Nova takes care of the property insurance for the Landlord, as soon as the bill for the insurance arrives it is posted as a Liability with the insurance company, reducing the Liability with the Landlord.
As the insurance bill is paid the insurance liability is closed.
5 The Landlord makes an expense that corresponds to Terra Nova.
On the 25th of August the landlord paid an expense for Terra Nova that increases our liability and our legal expenses.
At the end of the month the open balance value with the Landlord is closed with the payout.
We'd love to hear how this sample fits your business case and of course if you have any suggestions to make it better please send us a message through our support channel.