Correct way to handle credits and refunds

[Mike or Penny Novack]

timzak

>
>I guess what I'm asking is, if I credit an expense item, is it correct for
>it to show in the Income/Expense Report as income?
>
>Here's a real example, now that I'm in front of GnuCash:
>
>my wife was attending a chiropracter for some time.  Her co-pay was $10.  On
>one occasion, the chiropracter accidentally charged her $40 instead of $10. 
>So they credited the card $30.  So for that month, we paid $110 for doctor's
>co-pays, with a single $30 credit.  The net amount was $80 paid to medical
>co-pay, but GnuCash, in it's Income/Expense Report, shows medical co-pay as
>a $110 expense under Money Out, and a $30 credit under Money In.  GnuCash's
>report shows, under Money In, a series of Income:source line items, along
>with a single line item Expense:Medical:Co-pay.  It is odd seeing the report
>showing an "expense" under an Income category.  This is the root of my
>original question.
>
>So I guess my question is, is it correct for the report to be showing that
>credit as an "expense" under Income?
>
>  
>
OH --- what you mean is that time passed in between, two different 
reports. Well the correction was made after the first monthly report and 
GnuCash is showing  a negative expense item as "income". If you had had 
more copay expenses in the second month than the $30 then wouldn't have 
been a negative total in the second month.

GnuCash is simply showing (on this report) a negative income total as an 
expense or a negative expense total as an income. Both "income" and 
"expense" accounts are actually temporary accounts of fundamental type 
"equity" and we call them either "income" or "expense" according to 
which side of "equity" their totals usually represent. But usually isn't 
always and especially when a correction is spanning over report periods 
you can see things like this.

Try running a report covering the two month time period. Looks OK now?

BTW --- I don't know what "money in" and "money out" have to do with 
this but then I don't do "personal accounting" with GnuCash. What 
puzzles me in this case is that were I doing that, might have both 
"money in" and "money out" (cash flows) that had nothing to do with 
either income or expenses and could have income and expenses that had 
nothing to do with money in or out (money in/out or income/expenses 
against changes to liabilities or receivables)

Michael

PS --- This is one of the reasons the reports produced aren't the 
finished product. If you were submitting the report officially, you, or 
your accountant would have edited that part of it to show that item as a 
negative expense (red or in parentheses the usual way) and a footnote 
reference (with the footnote indicating it was a correction of an error 
in a precious month). Of course for personal reports you don't need to 
do things like that. I'm doing organizational bookkeeping, have to 
present to boards of directors and file with governmental entities, etc.

-- 
There is no possibility of social justice on a dead planet except the equality of the grave.