[GNC] Newbie Q: some transactions imported to wrong category

[David Cousens]

In the screen shot both of the lines of the transaction (splits in Gnucash
parlance) have accounts which are expense accounts. GnuCash is a double
entry system so when you make a payment for a purchase money is taken out of
your checking or savings account and given to the bank and this appears as
an expense. Other programs like Quicken often hide this from you but in
GnuCash it is explicit so any transaction records that money comes out of
your checking account and is spent on a specific expense.

i.e.                                    Debit            Credit

Asset:Checking Account                          $ 100
Expense:Car                       $100

is what you would expect to see for a purchase transaction        

That transaction in the screen shot is repayment of a loan. When a loan is
first created you receive money from your bank into your checking account
for example and you create a liability that records the fact that you have
an obligation to repay the bank. This for example for a $10,000 loan will
have splits as follows:

                                       Debit              Credit
Asset:CheckingAccount   $10,000.00
Liability:Loan                                      $10,000.00 


When you make a payment of $400 on that loan, you reduce that liability (
ignore interest for the moment)
                                        Debit              Credit
Asset:Checking Account                           $400
Liability:Loan                     $400

and your transaction should have had that general form. ( I'm leaving out
dates, description and the reconcile status and just concentrating on the
accounts and money coming in and out).

The use of debits and credits is not what you will see on your bank
statement which is the banks' recording of its financial position, not
yours. You will find an explantion of the basics of double entry accounting
and how debits and credits apply in accounting and GnuCash in the GnuCash
Tutorial and Concepts Guide (
https://www.gnucash.org/docs/v3/C/gnucash-guide/index.html) in the section
called Basics and in subsequent sections how to handle loans credit cards
etc in the section about Managing Personal Finances. Some time invested in
reading this will be well worthwhile.

The Help manual (https://www.gnucash.org/docs/v3/C/gnucash-help/help.html)
is also useful for more button by button description of the GUi interface
(or it was intended to be but in some parts the lines get a bit blurred
between it and the guide).

David Cousens



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David Cousens
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