I dont need to prepare a balance sheet , I want to figure the gain or loss on the foreclosed property . No amount received as the property went into foreclosure and the bank took possession of the building including the money for property tax/insurance held in the escrow account .
do you account for the escrow money that the bank took as part of the property or you deduct it from the mortgage loan balance or expense it ?
I believe the journal entry should be as follow:
Debit :
Mortgage loan $ 180,000
Depreciation : $ 150,000
Credit :
Building : $ 200,000
Escrow $ 20,000
Gain $ 110,000
Is that correct?
Thank you !!!!!!!!
