[GNC-dev] [GNC] Recording dividend payoffs
Frank H. Ellenberger
frank.h.ellenberger at gmail.com
Tue Apr 16 12:35:12 EDT 2019
Am 16.04.19 um 16:43 schrieb John Ralls:
> The Retained Earnings part of the Balance Sheet report *was* written with that in mind.
> The automatic calculation of retained earnings in the Balance Sheet report nets out the income and expense accounts; if there's a Retained Earnings account it will get reported too. Since the way to credit Retained Earnings (an Equity account) is to close the books, debiting all of the income and expense accounts by their balances and crediting Retained Earnings. Now income and expense are 0 and the calculated Retained Earnings line won't appear. You can treat its appearance as a reminder that you haven't closed the books yet.
We have in our Glossary
"Retained Earnings" "name of an equity account (?); to be distinguished
from the opening balance."
But that is a vague term. It was intended for private users, but
business users have EBITA, EBIT, ...
I remember, we had in German the translation "Gewinnvortrag", which is a
formal correct translation for "Retained Earnings", but it was not, what
GnuCash was showing. I did not check other translations, which meaning
they have choosen.
IMHO we should fix our terminology here. Suggestions?
> On the other hand, if you want to never close your books just create an expense account for dividends and exclude it from the various Expense reports and the Income Statement (aka Profit & Loss) report. That's not formally correct, but the result is the same.
I would not use an expense account, but reduce/share the income/equity
depending on the legislation.
> John Ralls
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