Credit/Debit Balance

[ShaneK]

Thank you all for your help. The problem proved to be a pretty foolish oversight on my part. I had learned from the tutorial how each account is supposed to behave and after a little algebra figured out why, but my eyes skipped over the scroll box for setting the account type when I recreated my Equity account. How silly. Thanks again everyone for taking the time to address my issue.

Shane

On Jan 31, 2017, at 4:33 PM, Mike or Penny Novack-3 [via GnuCash] <ml-node+s1415818n4689333h62 at n4.nabble.com<mailto:ml-node+s1415818n4689333h62 at n4.nabble.com>> wrote:

On 1/31/2017 12:54 PM, ShaneK wrote:
>       I am totally new to accounting and this software, so please forgive me
> if this question seems elementary or confused............ The problem seems to be that there is no way to change the meaning of the entries in the Credit and Debit columns. When a new account is
> created "manually", by default, Debit entries increase the account balance,
> and Credit entries decrease the account balance, unless the account
> hierarchy is created using the Account Hierarchy Setup helper.
No, and this is less a software problem than a fundamentals of
accounting problem.

Whether a debit entry or a credit entry increases or decreases the
balance of the account depends on the type of account. Depends on
whether an account type whose usual balance would be on the debit side
of the ledger or the credit side of the ledger.

I don't know it the tutorial section about the fundamentals of double
entry makes that clear or not (I have never looked at it). But some
examples:

for an account of type "asset" a debit will increase the balance and a
credit decrease it.
for accounts of type "liability" or "equity" a credit will increase the
balance and a debit decrease it
for an account of type "income" a credit increases the balance
for an account of type "expense" a debit increases the balance

Michael D Novack
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