how to automatically update equity account as each transaction is entered?

[Dean Gibson]

On 2016-04-11 19:47, DaveC49 wrote:
> Hi Francis,
>
> I don't think accounting is irrational ...

I agree.

> ... it just has no immutable laws of nature that we can appeal
> to constrain the practice ...

Only one:  Since accounting tracks where items of value (eg, money, 
assets, liabilities) has come from (credits), and gone to (debits), the 
sum must always be zero.  My accounting knowledge is entirely 
self-taught, and I have found the following model helpful:

I view double-entry accounting as a small one-room house with five 
windows, where items of value come in one window and out the other. 
Anytime something crosses a window threshold, it is recorded.  Since 
nothing ever stays in the one-room house, the balance of debits and 
credits is always equal (eg, sums to zero).  I don't view this so much 
as a check on the accuracy of the system, but rather a way of tracking 
the purpose of all transactions.

Where accounting gets complicated, is in philosophical decisions about 
that purpose:  Eg, is the purchase of an item an expense or an asset?  
That's the hard part to learn;  the math is easy. :)  I tend to be 
pedantic about some of it, because that helps me learn.  Eg, when I 
record income received, I enter the income tax withheld as an asset 
(that the Federal Gov't holds for me), and then adjust that when I 
compute my actual tax owed each year.  Ie, it's not an expense until you 
know how much it is.  Of course, I could just record each withholding as 
an expense, and then adjust it when the actual tax is computed, but I 
like the view of the pre-paid tax balance as a running asset.

> ...  I am not so sure that one can think ones
> way through science. Aristotle tried that and ...

In the same way, I often see accounting newcomers try to shoe-horn 
GnuCash (and occasionally, accounting principles) into their accounting 
needs.  That's almost always a disaster that comes back to visit them 
later in an audit (their own, their organization's, or the 
government's).  Millions of people around the world have refined AND 
AGREED ON an accounting "philosophy" that's based on plenty of 
experience and wisdom, and bucking the trend is usually a waste of 
time.  Accounting (as used by most people) is not going to change.