Partnership

[Jason Dunham]

On Thu, Dec 3, 2009 at 2:02 PM, Mike or Penny Novack <
stepbystepfarm at mtdata.com> wrote:

> Jason Dunham wrote:
>
>  I am using GnuCash 2.2.9 for a partnership (co-ownership of real estate).
>> For the most part, it is going fine, and I really like GC.
>>
>> Sometimes the partners have to kick in money (repairs, mortgage), and
>> sometimes they get money back (rents, reimbursements).
>>
>> I am treating each partner as a customer, and trying to use invoicing and
>> accounts receivable to track how much each partner owes.  I am currently
>> using a separate accounts receivable sub-account for each partner.
>>
>> I can issue charges on an invoice and receive payments, and it shows up on
>> the customer report, which is pretty nice, but it doesn't do everything.
>>
>>
>>
> The place to start is with an "Accounting for Partnerships 101" sort of
> book. The problem I see with the way you are doing it is that a partner
> COULD also be a "customer" of the partnership. Same person but a different
> business relationship.
>
> Normally with partnerships paying in is an increase in investment, paying
> out a withdrawal of investment (hopefully there were profits so the total
> investment went up) and this done via "drawing" accounts. And
> "reimbursements" would be neither (you could set up accounts for liabilities
> to partners -- in addition to putting in money as per the partnership
> agreement a partner might loan* the partnership money). But that's just from
> memory and keep in mind that I am not an accountant.
>
> Michael D Novack, FLMI
>
> * be careful -- you might need to be able to treat this as a loan for
> internal to the partnership accounting but to the outside world probably is
> not. The rest of the world isn't bound by the agreements between partners
> and courts will treat this as just "this partner made a greater investment"
> should things go south.
>

Thanks for the help, Michael.  I'm not too worried about the accounting
formality, since the partnership itself does not have tax or legal status.
I am using liability accounts for money owed, but the problem is how to pay
back that money or issue a credit to accounts receivable and have it show up
on some kind of statement useful to the partner.

For example, if a partner owes $200 for the current month's mortgage
payment, and had a prior balance due of $25, and she bought a new froob at
the hardware store for $50, I'd like to generate a bill or statement that
says, "Now you owe $175 and here's all the credits and debits to your
account this month."  The question is really about the easiest way to do
that in GC.

Thanks
Jason