Another beginners question

[FamiliaFrazelle]

Beth Leonard wrote:
> On Mon, Jan 22, 2007 at 04:22:08PM -0800, FamiliaFrazelle wrote:
>   
>> If i wish to have several Income accounts, one for my wife and one for
>> myself, say, can i pay some of the expenses directly from say, her account?
>>     
>
> I should first ask, do you and your wife have separate
> bank accounts?  i.e.
> Assets:Current Assets:My Savings      and
> Assets:Current Assets:Her Savings?
>
> or do you share the same bank account at the same bank i.e.
> Assets:Current Assets:Our Savings
>
> I'm going to assume for the rest of this answer that you
> have a joint savings account, and both of your paychecks
> are deposited into the same physical bank account at the
> same bank.
>
> When you have an expenses, think of how the real money is
> moving -- Is your wife's employer writing one check to your
> wife and one check to (for example) the bookstore when she
> buys a book?  Probably not.  Probably your wife's employer
> is writing one check to your wife that goes into your bank
> account, and then your wife is writing a check to the bookstore
> when she buys a book.  So the expense balances with a transaction
> to the bank account, not with the income account.
>
> [more below]
>   
>> When i try to do this, in the first place i input her income as Opening
>> Balance.  If i place it in the Income col., and in Transfer, place:
>> Equity:Opening Bal. for the amt. of her salary, the Balance col. appears
>> in red and as a negative number -- very strange.
>>     
>
> Typically Equity:Opening Balances is used for your asset and liability
> accounts, not income and expense accounts.  So if you just started
> using gnucash as of 1/1/07, then you can take your bank statement from
> the end of December and enter one transaction for your starting balance.
> Open up the Assets:Current Assets:Savings account, make a
> transaction dated 1/1/07.  In the "transfer" column, pick
> "Equity:Opening Balances"  Put the amount of money you had in the
> bank on that day in the "Deposit" column.  The money will automatically
> go to the right place in Equity:Opening Balances.
>
> Ok, now you have some money in the bank from before.  If your
> wife received a paycheck in November that was deposited in the bank,
> you don't need to do anything to record it -- it's already accounted
> for in your opening balances.  If she received another paycheck
> on January 15th that was deposited in the bank, then you enter
> her income just as you would yours -- but first you'll need
> to make an account for her salary if you want to keep it
> separate from yours.
>
> On the main accounts page, highlight "Income" then click the
> "New" button which is near the top of the screen in the row
> of buttons.  Under "Account Name" enter "Wife's Salary".  You
> should be able to leave the rest blank, then click "OK".  Now
> under "income" there should be two entries, one for your
> salary and one for your wife's.
>
> Next open up your Assets:Current Assets:Savings account,
> enter 1/15/07 as the date, tab over to description, type
> "Wife's income", tab to "Transfer" Type "i:w" as the shortcut
> to selecting "Income:Wife's Salary" then tab to deposit
> and enter the amount.
>
> Now your wife's income, which has affected the balance in
> your bank account, has been recorded.
>
> Now, for paying for an expense.
>
> Assume your wife wrote a check from the bank account to
> buy a book at the book store that you're calling Expenses:Books.
>
> Go to the Assets:Current Assets:Savings Account tab,
> enter the date and something like Bookstore-programming with Perl book
> in the description.  For the transfer account, select
> "Expenses:Books"  or type "e:b" then tab to withdrawal and enter
> the amount of the book.
>
> Now your bank account balance will go down, your expenses:books
> account balance will go up, and your wife's salary will remain
> exactly the same, because her job didn't pay for the book, she
> did.
>
> If you want to keep your expenses separate from hers, you
> can make even more expense accounts.  Click on Expenses
> in the main accounts tab, then "new" and call it "My Expenses"
> then click on Expenses again, and "new" and call it "Her expenses"
> Next click on "Her expenses" and click "new" and call it "books".
>
> This will help you keep track of how much you're spending vs. how
> much she is, because gnucash keeps the subtotals for you.
>
> I expect a question about handling credit cards and how to
> handle liabilities tomorrow night... :-)
>
>   
>> When i go to an Expense account and put the expense in the Expense col.,
>> and in the Transfer col. i put Income:HerJob, and go back and look at
>> the Income acct. (HerJob), it shows the expense as Income, in negative
>> numbers, but it has decreased the Balance.  Is this correct?  (whoa, is
>> it bec. it's "negative income"?, as in expense?)
>>     
>
> As explained above, the expense gets balanced with the place where
> the money came from -- if it was your bank account, use that, if
> it was paid for on a credit card, use the liabilities:credit card
> account to balance the expense.  (And later when you pay the
> credit card bill, there will be a transaction that's a withdrawal
> from your bank account and a credit on your credit card account.)
>
> PS. Don't forget to group-reply.
> --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?        +
> +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
>
>   
Dear Beth --

    i really appreciate such a long and involved reply.  The first clue 
that something was wrong was when i got to thinking about where her 
money "goes".  It's deposited - some of it - into a savings acct.  and 
when she cashes the check, it, too, is deposited.  Duh.  That's up there 
in the Assets.  No wonder.  So, i created Her Bank account.  i don't 
know which one it is, but by doing so was able to put Income into the 
credit col. of the Income acct., and into the debit acct. of Her Bank 
account.  From  Her ... i am now able to make expense payments - we do 
not use checks, but  i'm not worried about that at this point.  Now, my 
Income accts. appear positive (+)  and the only acct. which is negative 
is Equity.  i wonder why... do you suppose it's all those credit cards 
we have listed under Liabilities? laugh, laugh.
    Boy, i bet that if i generated some reports now they would actually 
make sense!

    Again, thanks a million!  Now things make much more sense!  Have a 
great evening!  :)

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