Advance liability payments

[Michael P. Reilly]

I do something similar with my budgeted auto insurance.  I get a bill that I
need to pay off in installments, but it is not a 12 month continuous
payment, usually it is about 10 months.

I create a liability under a new top-level placeholder account called
"Budgeted payments" (say "Budgeted payments:Auto Ins"), debit (increase) to
the account from Expense:Insurance:Auto and then credit on payments.  I keep
the liability open and debit on the next annual premium.  I keep the
liability open for the next year and debit when I get the next bill.  This
allows me to keep track of how much I've payed and how many more payments I
have left - not something I could do easily with just the expense account.
This also makes it easier when I get dividends from the insurance company.

For you, since annually, they readjust your expected bill for the year, you
could debit the account by 12X the monthly budgeted amount from the expense
account, and pay out of this 'fund' (within gnucash).

I treat this just the opposite of a mortgage escrow account, where you are
putting the same amount of money in and it is taken out on a different
schedule; annually the amount you put in is reevaluated.

On Sun, Oct 9, 2011 at 9:02 AM, Jim & Grace Flowers <
dondiegoflores at verizon.net> wrote:

> I'm using version 2.4.7 on Windows 7 Home Premium 32 bit.  I'm still
> learning how to use the program, but all in all, I like it.  However, I do
> have a question.  I'm on a budget plan for one of my utility suppliers.
> It's not municipal, it's a private business.  Should I set this up as a
> liability, as I pay each month, then when I have to "pay"  for the propane,
> just debit the expense account and credit the liability?  Right now, as I
> pay each month, I debit the expense account and credit the bank account.  I
> got to thinking about this, but don't know the answer.
>
>
>
> Jim Flowers
>
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