Usage question: equity balance not reflecting change in asset balance

[Simon West]

Hi Dominic,

The Equity is actually not supposed to change when you record  
expenses coming out of your checking account. In fact if you're using  
Gnucash for personal accounts it is unlikely that you'll use an  
Equity account again after using it for opening balances. When you  
start out, you need to put money into your checking account, but  
because we're using double-entry accounting that money must come from  
a different account, since all transactions must take place in two  
accounts. By convention, an Equity:Opening Balance account is usually  
used for this, but don't get hung up on the name, you could just call  
it Initial Balances if you wanted. From then on, you shouldn't need  
to look at the Opening Balance account again, unless you want to  
remind yourself how much money you had when you started using Gnucash.

Simon




On 18 Apr 2009, at 03:16, Dominic Ashton wrote:

> Hello all,
>
> I have set up GNUCASH using the user guide supplied with the software,
> and part of that involved me inputting:
>
> Opening balance $2000
>
> etc. in my checking account etc. The account I transferred to was
> "Equity: Opening balance"
>
> And everything was balanced and fine. However, now after I have added
> a number of expenses, although the balance of my checking account etc.
> is showing up correctly, the equity is still showing the previous
> balance (as if the expenses never happened).
>
> I went through the tutorial again:
> http://www.gnucash.org/docs/v2.0/C/gnucash-guide/txns- 
> puttoget1.html#txns-puttoget-add2
> and the same phenomena can be witnessed in the tutorial, where the
> assets are 1781.79, the liabilities are 500 dollars, but the equity is
> 1500 dollars. However, no reference is made to this in the
> documentation.
>
> I'm sure this must be really really simple, but a quick scan of the
> documentation and a google search did not reveal anything. Can someone
> point me to the correct page in the docs?
>
>
> Thanks,
>
> Dominic
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