Assets with a negative value treated as zero in reports

[Derek Atkins]

Buddha Buck <blaisepascal at gmail.com> writes:

> On Wed, May 15, 2013 at 2:59 PM, Derek Atkins <warlord at mit.edu> wrote:
>
>     What does it mean to have a "Negative Asset"?  How can you have negative
>     cash in your wallet?  How could you have negative money in your checking
>     account?  And no, "overdraft" doesn't count, because that's yet another
>     account that would be a Liability that gets tied to your checking
>     account.
>
> I don't understand the bit about an overdraft being a liability account tied
> to a checking account.  Certainly my bank displays my account balance as
> negative when I'm in an overdraft situation.

Really?  Mine doesn't.  Mine shows a third account, which is the
overdraft account.  The main account never goes below zero.  I guess it
depends on the bank.

> Without getting into the dynamics of having overdrafted bank accounts
> (generally considered a bad thing), how would/should I deal with this
> situation:  I bill a customer $50/month for a recurring service on the first
> of the month, starting 1 January; He sends me a payment for $300 on January
> 15th, explicitly telling me it's a prepayment.  Naively using the business
> functions in GnuCash, this would have the following balances in the Asssets:A/
> R account: 1/1: $50, 1/15: $-250, 2/1: $-200, 3/1: -$150, etc.  If the A/R
> asset account is never allowed to be negative, how should GnuCash be set up to
> handle this properly ("properly" meaning that the Customer Report for that
> customer reports the correct outstanding balances, and that the invoices are
> listed as "paid" when searching for invoices for the customer)?

Honestly, the gnucash reports SHOULD report on a negative asset
correctly.  If you find a report that doesn't then can you please set up
a sample data file and report it as a bug?

-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