Beginners question, confused between real bank accounts and gnucash accounts

[Buddha Buck]

A set of books (like a GnuCash file) represents the financial dealings of a
single entity. Income and Expense accounts represent ways in which value
comes into and leaves that entity.

In this case, since the entity represented in your books is a combination
of your personal and business interests, the transfer of money from the
business account to your personal account does not represent any value
coming into the entity, so it is not an income or an expense. Your
transferring of funds direct from one checking account to the other is fine
in that setting.

However, you probably don't want to think of you and your business as being
one single financial entity. The fact that you are calling the funds
transfer a "salary" and thinking that it should somehow be income leads me
to believe that you think of your personal and business dealings as two
separate things.

In which case, you should have two sets of books, one GnuCash file for your
personal dealings, and one GnuCash file for your business dealings, and
work to keep the two separate (at least, separate until tax time, and there
are ways to deal with that when it comes).

If you have two sets of books, then the transaction of paying your monthly
salary becomes two transactions, one in each set of books. In your business
books, your salary is an expense, and would be recorded as a debit to an
expense account (and a credit to your business checking account). In your
personal books, your salary is income, and would be recorded as a credit to
an income account (and a debit to your personal checking account).

On Thu, Mar 24, 2016 at 2:14 PM Nicolas Severyns <nicolasseveryns at gmail.com>
wrote:

> In my account setup, I have a private checking account and a business
> checking account. Monthly, I transfer my salary from my business
> checking account into my private checking account. (in reality).
>
> I enter this transaction into Gnucash, as a transfer between private
> and business checking accounts, with description 'salary'.
>
> But I also have an Income:Salary account. How should I use that account? If
> Should create a new booking on my private checking account, sending the
> money I received
> from my business checking account to this Income:Salary account?
>
> If I do that, the checkings account bookings would not reflect my bank
> statements.
>
> I think I am confusing things, but I don't understand what exactly.
>
> Any pointers in the right direction would be greatly appreciated.
>
> Kind regards,
>
> Nicolas Severyns
>
>
>
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