Business Acquisition - where to allocate?

Question

Looking for a little advise please :)&nbsp;The business has purchased another business as a going concern. The total amount is a combination of IP/URL/Website/1300 plus stock.The owners took out a small loan to make the initial payment (I have created a long term liability and applied it there. The remainder owing is on a long term payment plan.How do I reflect this sale in the Chart of Accounts.The business tracks inventory (via items).We have reached out to the accountant who is away atm.&nbsp;Help very much appreciated.&nbsp;

princess_r · Answer

Hi Cherylynn101​,&nbsp;That’s a really good question! Business acquisitions can get a bit tricky, but it sounds like you’re handling things well so far. When you’re recording all the different assets you’ve picked up through an acquisition, it does take a bit of careful sorting in your chart of accounts, so it’s awesome that you’ve connected with your accountant. They'll be able to help you set everything up just right for your business. While we can’t give you tailored financial advice, I’ve list some helpful articles that break down best practices for loans and purchases:Loans and repaymentsJournal entryCreating itemsAsset acquisition basics for the new business ownerHopefully, other members can jump in here and share their expertise when it comes to recording these kinds of transactions.&nbsp; &nbsp;&nbsp;Cheers,Princess&nbsp;

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Business Acquisition - where to allocate?

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