Best way to organize accounts

[eschvoca]

Thanks for the responses.  I think I understand my problem.  When my
bank account makes an income (e.g. from interest) I should transfer it
_from_ an Income account _to_ an Asset account.  I was thinking the
transfer happened in the other direction.  Then my balance in the
Asset bank account should equal the balance of the bank statement.  Is
that right?

-E


On 8/23/06, Firebird <phnix at fastmail.net> wrote:
> I think your problem here may be a misunderstanding of how gnucash accounts
> are set up and the like. Your "Checking Account" for instance should be an
> asset. Every transaction you make with your checking account should in some
> way pass through that account and when you get your statement it should
> reconcile easily. However, since gnucash intreprets everything as an account,
> all those transactions will also appear in expense accounts, income accounts,
> or transfers to other asset or liability accounts (like paying off credit
> cards or putting money into savings and investments). All of this works to
> balance the accounting equation. For example, if you go and spend $10 on
> lunch, that would be a debit to your checking account and a credit to perhaps
> your Expenses:Dining Out account. Most other accounting programs use
> catagories for income and expense and this can cause confusion when doing it
> the gnucash way since you have to actually set up accounts that "don't exist"
> in the real world. However, when you can see all your money as just transfers
> between different accounts, it can get a lot clearer. Take a look through the
> concepts guide (http://svn.gnucash.org/docs/guide/) for a better
> understanding of all this. It does much better justice to it than I can. =)
>
> Good luck,
> -Kyle Bishop
>
> On Tuesday 22 August 2006 18:17, eschvoca wrote:
> > >From what I can determine there are two fundamental ways someone can
> >
> > organize their account trees:
> >
> > 1) Use transaction types at the top level (Assets, Equity, Expenses, Income
> > Liabilities)
> >
> > 2) Use real-life grouping at the top level (Checking Account, etc)
> >
> > In (1) if your real-life Banking Account has Assets, Expenses, and
> > Income then you could have a separate Gnucash Banking Account under
> > those top level accounts.  In (2) Banking Account would appear once at
> > the top-level and it could contain sub-accounts of Assets, Expenses,
> > and Income.  Whatever is at the top level it is easy to get a summary
> > for all subaccounts.
> >
> > Currently I've setup my accounts using form (1) but find that I can't
> > reconsile my statements because there is no overall balance for my
> > bank account.  I'm tempted to do the big switch to form (2) but I
> > thought I first check with people to see what their suggestions are.
> > If I go with (2) can I still get my total income somehow (e.g. from a
> > report)?
> >
> > What do people recommend?
> >
> > -E
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