One account for both Income and Expenses possible?

[Mike or Penny Novack]

On 2/11/2018 9:03 AM, Robert Heller wrote:
> At Sun, 11 Feb 2018 08:15:56 +0100 Jeff Abrahamson <jeff at p27.eu> wrote:
> ....... transfer
> "money" from the vegetable account to a bank account (income when you sell
> vegetables) and when you transfer money from a bank account to the vegetable
> account (an expense when you buy vegetables). *I* do this which my inventory
> of thumb drives. GnuCash does not have "inventory" accounts or any way of
> dealing with inventory as such
Inventory MANAGEMENT is something else (gnucash lacks this but that 
belongs in an inventory system*, not "general ledger".

But you are saying that gnucash does not support inventory value and 
cost accounting and that is simply not so.

Let's say incidental to its main activity an organization sells various 
things (tee shirts, coffee mugs, etc.) as a fund raiser. You create 
under Assets (after "current assets" and "fixed assets") a parent 
"Inventory of goods". Under that might be accounts (more likely also 
parents as batches of goods might have different basis) for "tee 
shirts", "coffee mugs", etc. When the organization buys a new batch of 
tee shirts that is a debit to "tee shirts" (or as I mentioned, perhaps 
"tee shirts batch 4" --- the account description can include what the 
unit price was for this batch) and a credit to checking << note: we get 
confused using the supposedly more user friendly terms worrying about 
what sort of "transfer" this is). Each sale of a tee shirt not only 
debits cash and credits "sale of tee shirts" for the sale price but also 
debits "cost of goods sold" and credits the inventory account "tee 
shirts batch N" for the unit cost of batch N << going to be a policy 
decision whether to simply use FIFO or to actually worry about from 
which batch that shirt came. Maybe BOTH come into play. To use your 
example, thumb drives, you might have 8 Gb drives (batches of those) and 
16 Gb drives (batches of those) so you might want under "thumb drives" 
children "8 Gb drives" and "16 Gb drives" and under each of those "batch 
1, batch2, etc. and use FIFO there >>



Michael D Novack

* The data kept here things like "number on hand", "physical location 
where shelved", "reorder point", etc.