How do I account for a promise to pay something?

[Derrick Hudson]

On Sat, Nov 22, 2008 at 11:04:43PM -0500, Tim Wunder wrote:
| I made a promise to pay my church X dollars for their building fund over the 
| next 3 years. What's the best way to keep track of that?
| 
| Right now, I've created a liability, Liabilities:Promise, of $X, debiting 
| Opening Balances. When I make a payment against that liability, I credit 
| Checking and debit Expenses:Charity, and add a split to debit 
| Liabilities:Promise and credit Opening Balances the same amount.
| 
| Is there a better way?

You pretty much invented "Accounts Payable", which is simply the
accounting term/mechanism for a promise to pay.  This is very
reasonable.  You can create a scheduled transaction to help remind you
to make your gift on a regular basis and to simplify recording the
transaction.

My system for commitments to charitable gifts is to record only my
actual expenses in gnucash (essentially a cash basis).  I use SXes and
also have a spreadsheet to track and visualize what I committed to
versus what I already paid.  I have each month across the columns, and
each commitment down the rows.  When I write a check I fill in the
amount in the spreadsheet.  This allows me to easily see at a glance
which commitments I have or have not paid yet for each month.  (I
could also check each expense account in gnucash, but I find this
easier)  It also provides a nice set of running totals and some
summary computations for immediate up-to-date feedback.

-Derrick

-- 
Many are the plans in a man's heart,
but it is the Lord's purpose that prevails.
        Proverbs 19:21
 
www: http://dman13.dyndns.org/                  jabber: dman at dman13.dyndns.org
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