Inserting transactions with debit card, cheque and prepaid card

[Mike or Penny Novack]

LuisDaniel Lafaurie wrote:

>Hi Claudio,
>
>I use to put payments done using a credit card under 'accounts payable' and
>that under 'liabilities'.
>
>Each payment with the credit card is treated as 'money borrowed from a
>bank', and when the balance on the credit card is reduced by a partial or a
>full payment, this money sholud be deducted from an 'asset' such as current
>account, savings account, cash in wallet, just to name a few types of
>assets.
>  
>
An "account payable" is of course a liability but not all liabilities 
are accounts payable << in the sense that term is usually meant >>

Perhaps just a matter of taste, but I'd consider a credit card account 
more of a formal liability, just as you would treat a "line of credit", 
in this case unsecured, but still a formal credit line with a bank. So 
I'd put the credit card account under liabilities but not as a child of 
"accounts payable".

As noted in other responses, a "debit card" account would be an asset 
under "current assets". Not cash per se, not a bank account, another 
category. Besides "debit cards" there are other sorts of prepaid cards 
(vendor specific) and amounts more tightly linked to a specific vendor* 
and these can all be grouped together.

Michael

* Like "to all our good customers, here's a code you can apply to your 
next order to get $10 off"