Prepaid Services (Unearned Income, Unearned Revenue)

[Derek Atkins]

Hi,

rshgeneral <rshgeneral at yahoo.com> writes:

> I'm a new gnucash  user helping someone switch from quickbooks.  I'm not sure
> how gnucash handles prepaid services.  In accounting, I believe I would
> credit (increase) a Prepaid Services account (a liability account) and debit
> (increase) a checking account.  Using this process would produce the correct
> accounting result, however, I just want to be sure that there is not already
> a proper way to do this in gnucash using invoices.  I'm not even sure if you
> are supposed to create an invoice for a prepaid service.  Whenever I try to
> create an invoice, it allows me assign it to an income or liability account
> (i like).  When I try to post the invoice, I'm restricted to posting it to
> Accounts Receivable (i dont like).
>
> Should invoices be used for Prepaid Services? Or should I just utilize
> general ledger transactions until the service is performed and then create
> the invoice and take the payment?

Just Process Payment for the pre-payment, and Invoice as usual for the
services as they are rendered.  The Customer Report will show how much
they owe or how much they have on credit.

-derek

-- 
       Derek Atkins, SB '93 MIT EE, SM '95 MIT Media Laboratory
       Member, MIT Student Information Processing Board  (SIPB)
       URL: http://web.mit.edu/warlord/    PP-ASEL-IA     N1NWH
       warlord at MIT.EDU                        PGP key available