Depreciation

[ghaverla@freenet.edmonton.ab.ca]

On Tue, 20 Mar 2001 linas@linas.org wrote:
> It's been rumoured that ghaverla@freenet.edmonton.ab.ca said:

> > Okay, I gave this Account a name of "Owner Equity", and it
> > is of type "bank".  It's description is
> 
> Hmm, to avoid naming confusion, I think you want to have 
> "equity" accounts be marked as type "equity", not "bank".
> In partiucular, this will help when you go to generate a report. 
> 
> (Note, the opening balance of a bank account should be represented
> as a transfer from 'equity' to the bank. All other transfers
> to/from the bank should be to income/expense/asset/etc accounts)

To "properly" track depreciation in a small business which
is NOT making a profit, I need to make a loan from an 
equit account labelled Owner Equity to a bank account,
which immediately transfers the funds to a Capital
Additions account?  Seems like a lot of machinery, but if
that is the best thing to do, ...  The owner (me) is going
to be making loans to this company for quite a while.  The 
space industry is not yet at the point where one can
make a living at it.

Gord

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Gordon Haverland, B.Sc. M.Eng. President
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