how to setup a revolving credit facility account

[Cam Ellison]

David Latham wrote:
> Thanks Robert,
> 
> It looks like this might be the best way to go about it.  I still find
> it unfortunate that there is no way to record the available credit
> because: It is in fact an asset.  

I beg to differ.  It is not cash you actually possess, nor a certificate 
invested with some kind of value.  If you take money from it and put it 
into another account, that money is an asset, with an offsetting 
liability that costs you in interest.

> The bank treat this available credit
> as equity.  
Of course it does.  That works for its marketing, and in fact any money 
that you borrow from it is an asset from its perspective; a receivable, 
in fact.  It really should not matter to you how the bank wants to think 
about it.  The simple fact is that you have a certain amount of 
headroom, which a quick mental calculation will give you.  You could 
include the amount in the Description field as a reminder.


> I guess there is not really a perfect way to handle this in GNU CASH.  I
> would like to be able to create a split account. 

The issue, as I see it, has nothing to do with Gnucash.  Double entry 
bookkeeping, one of the foundations of modern business practice, not to 
mention the Industrial Revolution and the rise of Capitalism, if I may 
be so bold, is what stands in your way.

> Show a portion in
> Liabilities and the balance in Assets.  The combined value is the the
> total reducing amount...

You still have to do some kind of calculation, likely in your head.

I wonder whether you should re-think what is important to you, i.e. what 
information do you need to have, and what will having that information 
do for you?

Happy cogitating

Cam

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