Bookkeeping Question - How to record a property purchase

[Marian Fine Frueh]

Dear BP community,

Perhaps this is a basic and easy question, but I am not an experienced bookkeeper.  I understand debits and credits and income statement accounts vs. balance sheet accounts.  But I am new to real estate investing this year and don't know how to record an initial purchase of a property.

I purchased a property with traditional financing.  How do I record the cash to close?  

I recorded some of the closing costs (prepaid interest, appraisal, etc.) as expenses.  I created a GL account called Escrow, as an equity account, and I recorded the initial escrow payment there.  I created a liability account called "Mortgage [property address]" and entered the down payment against that account.  And I created a Fixed Asset account called "Property [property address]" and recorded the value of the property there.  I got everything to balance out.

However, then my tax accountant told me something about recording the initial purchase to balance sheet accounts, and said something about cost basis.  I didn't understand what to do. (And he is $200/hour, so I didn't ask for additional details.)

Any help would be much appreciated.  Thank you!!!

Marian