[GNC] Recording transactions (date)

[Stan Brown (using GC 4.14)]

On 2024-04-09 01:19, David Carlson wrote:
> Nearly every time [the bank's] list doesn't match my list, the
> difference is precisely the difference between when I wrote the check or
> when I initiated a payment online or when I swiped a card and when they
> posted the transaction to my account.  That is what we users often consider
> to be the difference between accrual basis vs cash basis.

I must respectfully disagree. That difference is simply timing. It can
occur whether you are on a cash basis or an accrual basis, but in itself
it is not a difference between cash and accrual basis.

The chief difference between cash basis and accrual basis, for a person
as opposed to a business, is whether you record money you owe but
haven't paid (liabilities) and money owed to you but not yet received
(assets).

For example, suppose you have a credit card, and to avoid paying finance
charge you chose to have your bank automatically pay the latest
statement balance on the payment due date. How is a restaurant dinner
recorded when you pay by credit card?

On cash basis, it's not an expense until it's paid. Therefore, _nothing_
is recorded until the payment date after the statement date after the
meal. Then you record
	Dr: Expenses:Restaurant Dining
	Cr: Assets:Cash in Bank
and a similar entry for every charge on that month's credit card statement.

On accrual basis, it's an expense when it's incurred. You make this
entry when the meal happens:
	Dr: Expenses:Restaurant Dining
	Cr: Liabilities:Credit Card
and then when the payment happens, you make _one_ final entry:
	Dr: Liabilities:Credit Card
	Cr: Assets:Cash in Bank

Since the payment is automatic, you and the bank will record it as of
the same date, whether you are on the cash basis or accrual basis.

Stan Brown
Tehachapi, CA, USA
https://BrownMath.com