Problem with transaction types
devenson at shaw.ca
Fri May 5 18:10:05 EDT 2006
120010362905 at post8.tele.dk wrote:
> I have a problem understanding how to report certain transactions in GnuCash. I hope somebody more intelligent than me will be able to sort it out. This is an example:
> On January 27th I pick up something for a friend at a store. I pay with my charge card. Because of a 40-day credit period this is not due for payment before March 10th.
> My friend des not want to have any outstandings, so he makes a transfer from his bank to my bank on January 31st. All settled then.
> As I see it the purchase that I make on Jan 27th is not an expense and the money that I receive from my friend a few days later is not an income. So what is it?
> I would imagine that my purchase is a cash flow liability kinda thing, but am not sure???
> The money coming in from my friends settlement of his debt to me is what?????
> Anyone out there able to help me with this one?
> thank you
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1/27 Debit Asset:Accounts Receivable:Friend
Credit Liability:Credit Card
1/31 Debit Asset:Bank Account
Credit Asset:Accounts Receivable:Friend
Thus your bank and your credit card accounts will be higher until you
pay off your credit card. Your friend's account is 0.
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