Am I missing something?

[Alex Hill]

So what would you suggest to avoid closing the books and still being able to 
track drawings appropriately?

Thanks for all the help and advice so far... Hopefully once I finish my 
degree I will be able to help others a bit more :)

Cheers,
Alex
----- Original Message ----- 
From: "Derek Atkins" <derek at ihtfp.com>
To: "Alex Hill" <alex_hill at arach.net.au>
Cc: "Pablo Francesca" <rshgeneral at yahoo.com>; <gnucash-user at gnucash.org>
Sent: Monday, May 24, 2010 9:23 AM
Subject: Re: Am I missing something?


> Hi,
>
> On Sun, May 23, 2010 9:14 pm, Alex Hill wrote:
>> Thanks for the replies. How would I go about transferring the amount
>> across at the end of the period? Would I just zero off the income/expense
>> account and increase/decrease retained earnings appropriately (then from
>> retained earnings to owners drawings if required)?
>
> If you really really REALLY want to, then yes.  You could even use the
> Tools -> Close Books functionality to do it for you.  But keep in mind you
> cannot run reports across a book closing transaction, so you'd lose the
> ability to e.g. run a multi-year report.  YMMV.
>
> -derek
>
>>   ----- Original Message -----
>>   From: Pablo Francesca
>>   To: Alex Hill
>>   Cc: gnucash-user at gnucash.org
>>   Sent: Monday, May 24, 2010 12:15 AM
>>   Subject: Re: Am I missing something?
>>
>>
>>         Equity is realized over a defined period of time. When you close
>> your books for the month/quarter/year, that is when you will
>> realize profits and affect the equity account.
>>         If your anxious to see how you stand profit-wise, just run an
>> income report.  The net income is the amount your equity will
>> change at then end of the accounting period.
>>
>>         Think of a change in equity as the time when you actually claim
>> your profits.  Or think of a change in equity as the time you
>> actually realize profits.  One might say that it is arbitrary that
>> at the end of one period you can claim a profit and the next day
>> you cant, but that is the nature of accounting.
>>
>>         Of course, I'm not an accountant so there might be a better
>> explanation.
>>
>>         --- On Sun, 5/23/10, Alex Hill <alex_hill at arach.net.au> wrote:
>>
>>
>>           From: Alex Hill <alex_hill at arach.net.au>
>>           Subject: Am I missing something?
>>           To: gnucash-user at gnucash.org
>>           Date: Sunday, May 23, 2010, 8:06 AM
>>
>>
>>           I am a little confused about the relevance of the accounting
>> equation:
>>
>>           Assets = Liabilities + Owners Equity
>>
>>           When I make up an invoice (service) I increase cash and sales
>> accounts, but there is no change in the equity accounts. Am I
>> missing a step? Should I somehow be increasing my owners equity
>> / retained earnings etc when invoices are paid off?
>>
>>
>>
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>