Expense & Liabilities accounts
tom.collier at comcast.net
Mon Mar 19 11:57:16 EDT 2012
At the macro level, accounting is accounting is accounting, so I'll
hazard an answer to your question, UK or not.
In layman's terms.....Liabilities are amounts that you actively owe;
loans both short & long term; taxes that you have collected from others
that have to be paid to some government entity such as VAT or sales
taxes, or (does UK require employer tax withholding from employee
paychecks?), credit cards, etc.
Expenses are used to track and categorize (oops! UK you said?)
"categorise" money that you have already paid out; you pay your rent,
you allocate it to the "rent" expense account; you buy groceries, you
allocate that money to the "food" account and so on.
Liabilities accounts generally always show a balance ... unless you owe
no money to anyone (and that's a good thing!)
Expense accounts follow the accounting period cycle and zero out at the
end of each accounting period (month, quarter, year.) Your "groceries"
account starts out at "zero" on Jan. 1 and builds up until it shows £80
as of Jan. 31. On Feb. 1, your groceries expense account resets to £0,
and you start tracking that expense over again. On March 1, it again
resets to £0, and so on.
Now, GnuCash doesn't literally "zero out" the expense accounts on your
register displays, but for reporting purposes, that is what happens in
the calculations background when you want to know your financial
standing for a given month, or quarter, or half-year, and so on.
Your best bet would be to consult with a UK accountant for any
country-specific rules as you set up GnuCash...especially if you use GC
for business. Revenue Departments around the globe tend to get testy if
you mess up in the taxes payable department.
On Sun, 2012-03-18 at 04:55 -0700, theporter2000 wrote:
> I've just created A/Cs in liabilities what are the difference between
> *Expense & Liabilities* I'm in the UK if that makes a difference although I
> don't think It dose
> View this message in context: http://gnucash.1415818.n4.nabble.com/Expense-Liabilities-accounts-tp4482040p4482040.html
> Sent from the GnuCash - User mailing list archive at Nabble.com.
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