GL Accounts

Maf. King maf at chilwell.net
Fri Dec 8 11:38:49 EST 2017


On Friday, 8 December 2017 14:52:04 GMT you wrote:
> Thank you Mr. King for your response.  My question is not about accounting
> principles but more so how do I do that in GC.  When I go to “Process
> Payment” the only thing available to “Post To” is “Assets:Accounts
> Receivable”.  I cannot put anything else in there nor can I put multiple
> accounts in there.  Also in the “Transfer Account” section I can only
> choose one account.  However, in processing a payment it should normally
> debit a cash account but having the freedom to debit or credit any account
> would be useful.
> 
> Then I went to create an invoice and in the "Invoice Entries” section I can
> only select and Income Account in the “Income Account” column.  I tried to
> type in an equity account like “Equity:Opening Balances:Caleb Startup
> Capital” and the program said that the account did not exist.
> 
> I have followed these same examples in A/P as well to no avail.  Is there a
> config file I need to edit to allow me to get out of this “jail” where the
> program is forcing me to shoe-horn my processes?  I also cannot find a way
> to do a “split transaction” yet.  I am still looking though.


Hi Caleb,

GC _started_ long ago without any particular special treatment for accrual 
accounting, primarily for personal accounting.  One just directly entered all 
transactions in (say ) a bank account register and assigned transactions to 
the relevant "other" account(s).

   Then, around version 1.6 or 1.8, a module known as "business features" was 
added, which introduced the handling of A/P and A/R as special account types 
and permitted accrual accounting without having to fudge about.

So, if you are using accruals - you receive a bill and expect to pay it at 
some time later on - you _can_ create a vendor, enter the bill in the 
"business" features.  You are correct that at the point of entering a bill, 
you cannot assign the transactions to any account - income types are not 
valid, for example.  However, Vendor bills would usually be for an expense (or 
capital asset purchase) and asset & expense accounts are all valid 
destinations.  When you come to actually pay the bill, you go to the process 
payment, and select the bill.  At this point, the bill is tied to you A/P 
account and so half the transaction is known.  The other account you select 
can be any bank or cash account.

If, however, you are not using accruals, but paying directly for something in 
cash (let's say a business lunch out with a client), you don't touch vendor 
bills or process payment at all.  Just open your cash account (or credit card 
or checking etc. - however you actually paid), and directly enter the 
transaction with a transfer to Expenses:EntertainingClients

similarly with invoices.  If you haven't created an customer invoice in GC, 
there is nothing to process payment against.  Cash sales don't use accruals. 

  You didn't issue an invoice for your owner capital (at least, I assume you 
didn't.  More likely a share certificate after the fact).  Just open the bank 
account, and create a transaction transferring from Equity:OwnerCapital:Caleb 
- if that account doesn't exist, GC will offer to create it for you.

Split transactions: (if you are not using "view->auto-split ledger") right  
click on the area of the register where you are entering a transaction, and 
select "split transaction", or press the tool button marked "split"


in summary: if it isn't a "proper" accrual transaction, don't use the accruals 
subsystem!  Enter directly in the relevant Bank/Cash/Credit Card registers.

HTH,
Maf.




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