Association and group purchases paid out

[Mike or Penny Novack]

Dennis Powless wrote:

>
>
> I was assuming that the funds from the members was considered income 
> and had to go in an income account.
>
> How are these funds tracked in the overall equity equation?
>
>
>
> Can I do something similar with donations we collect from members and 
> that gets donated to charities?
>
>
> Thanks very much for your assistance.

No --- assuming you are a typical non-profit, then memberships, dues, 
donations, etc. from your members are "income" and donations to charity 
would be an "expense" (program expense as opposed to management/overhead 
expense, you normally want these grouped separately).

Look, you really do need to find an instructional text along the lines 
of "bookkeeping for the small non-profit".

As for how your first question affects equity, assuming that you succeed 
in handling these T-shirts at cost, it doesn't. Just transactions 
between different asset accounts, not unlike the situation where you had 
several bank accounts and were transferring money between them. You were 
going from cash => inventory of T-shirts => cash.

Note that for non-profit reporting, "cost of goods" is a line item (and 
"gross sales" and "net"). May affect how (if) you are required to file.


Michael D Novack