Record income/ expense from side gig

[Mike or Penny Novack]

On 8/21/2016 8:59 PM, DaveC49 wrote:
> Hi Chris,
>
> .......
>
> I have experimented with creating top level entity placeholders in Gnucash,
> but the new account dialogue does not allow creation of a placeholder which
> doesn't have an account type and if you create a placeholder account with a
> specific type , e.g.  Asset the options for sub accounts are limited to
> types relevant for asset accounts, i.e. you cannot create sub-accounts of
> type Income ,Expense or Liability as sub accounts of a placeholder Asset
> account. there was a thread some time ago also discussing whether this was
> possible
For those of us who learned bookkeeping in the days of pen and ink on 
paper, how to do this is more obvious. It is all debits and credits.

There is nothing special about the account types "income" and "expense". 
Both are temporary accounts of fundamental type "equity" and the type 
assignment in gnucash just a way for them to be grouped in the Income 
Statement. In other words, as soon as you can think of an expense as a 
negative income or an income as a negative expense your way forward 
should be clear.

If the gig is expected to make a profit, the gig parent goes under 
income, but if a loss, put it under expense. Then under the gig parent 
put two children, "gig-income" and "gig-expense". For a moment, let us 
assume that this is expected to be a profit making gig, so "gig-parent" 
would be of type income and so would all children under it. That's 
right, "gig-expense" would be of type INCOME and so would all the 
individual accounts under it. IT WILL BE HOW YOU ENTER TRANSACTIONS THAT 
MAKES THE DIFFERENCE. For the actual income accounts, you will be 
entering credits. For the ones that are expenses, you will be entering 
debits. In other words, for these accounts the supposedly more user 
friendly column titles might be misleading and until you get the hang of 
this debits and credits might ease the way.

Michael D Novack