Splitting Expenses Monthly

[Beth Leonard]

On Sat, Mar 11, 2006 at 04:01:42PM -0500, Josh Sled wrote:
> I would not try to do it in the form "sum monthly expenses and divide",
> but instead handle it on a per-expense basis.
[...] 
> A good example is a phone bill, where the local/unmetered "base" expense
> is shared evenly, but each individual's long-distance portion is
> enumerated:
> 
> | Phone | Assets:Checking               | <A> |     |
> | Mike  | Expenses:Phone                |     | <B> |
> | Bob   | Assets:Money Owed To Me:Bob   |     | <C> |
> | Sally | Assets:Money Owed To Me:Sally |     | <D> |
> 
> Where:
> <A> := base + sally_ld + bob_ld + mike_ld
> <B> := base/3 + mike_ld
> <C> := base/3 + bob_ld
> <D> := base/3 + sally_ld

Two things:
1. If you don't want to do it with SX's, it may be easier
to create one transaction for each bill that does it
"right" with all the splits, then use the "duplicate
transaction" feature each month for future months.

2. The problem with Josh's example transaction is that it assumes
that Mike is going to pay all the bills and then be reimbursed for
each one.  In house sharing arrangements, sometimes this
gets complicated if one person is slow for their share of
the bills; it frequently works better if Mike pays the
phone bill, Bob pays the cable bill, and Sally pays the
newspaper bill, then at the end of the month smaller
amounts of money change hands.

Depending on your level of house-sharing, getting a joint
bank account, having each person use a monthly bank transfer
to pay into it, and paying shared expenses out of the joint
account can also work.  (My friends have been doing that
for several years successfully now.  Their website is:
http://www.alpinebutterfly.org/ but it hasn't been updated
in some time.)

If you're doing each person pays for one bill and discrepencies
are handeled at the end of the month, you could keep a separate
set of household books like this:

Assets:
	People:
		Mike's virtual Account
		Bob's virtual Account
		Sally's virtual Account
Income: (to the household)
	Mike (Things paid for by Mike)
	Bob (Things paid for by Bob)
	Sally (Things paid for by Sally)
Expenses:
	Rent
	Newspaper
	etc.

At the end of each month you make real payments between indivuals
to make each virtual asset account go to zero.

For example:

The rent comes due:
Expenses:Rent	$999
Assets:Mike		$333 (= $999/3)
Assets:Bob		$333
Assets:Sally		$333
-- and Mike pays it:
Assets:Mike	$999
Income:Mike		$999	

You can do all of these splits from the Assets:Mike account.  Open
up that account, click on split, and enter the numbers.  Next month
if Mike pays the rent again, just duplicate this transaction and
put a new date on it.

Now in the account overview window, you'll see that Mike now has
an asset of $666, and the other two have negative assets of $333.

Let's say Bob doesn't read the newspaper and refuses to pay for it,
so Sally pays for it and Mike & she split it.

Expenses:Paper	$40
Assets:Mike		$20 (= $40/2)
Assets:Sally		$20
-- and Sally pays it:
Assets:Sally	$40
Income:Sally		$40	

Enter this as one transaction from Sally's Assets account.

Now we come to the end of the month.  The Assets totals look like
this:
Bob:	-333.00
Mike:	$646.00
Sally:	$-313.00

We need to make real payments such that each person's balance goes back
to zero.  Bob and Sally both write checks to Mike (or on-line transfer
or whatever)  Bob writes Mike a check for 333, Sally for 313.

Assets:Mike		333
Assets:Bob	333

Assets:Mike		313
Assets:Sally	313

If Alice and Carol lived there too and the amounts were different, 
for example and end-of-month total like this:

Alice:		-100
Bob:		-200
Carol:		$150
Mike:		$320
Sally:		-170

As long as the Income/Assets/Expenses all match up and you
have balanced transactions, I believe the assets should always
total zero.  In this case, Sally could write a check to Carol
for $150 and mike for $20, and both Alice and Bob could write
their checks for the full amount to Mike.

If a bill doesn't split evenly (like the long distance phone bill) you
still enter it as above, just adjust the amounts "billed" to each
asset account.  Make sure the total results in a balanced transaction.

It's a bit of extra overhead to divide up each bill like this, but
if you are living with people who are uptight about tracking where
each penny goes and making sure they don't pay more than their
"fair share" or they'll fight about it, it can save headaches.

Good luck!
--Beth 
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+                             Beth Leonard                          +
+       O say, does that star-spangled banner yet wave              +
+       O'er the land of the free and the home of the brave?        +
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++