[GNC] Directors loan - do I need an expense account?

[Dr. David Kirkby]

On Fri, 10 Dec 2021 at 20:28, Michael or Penny Novack <
stepbystepfarm at comcast.net> wrote:

> On 12/10/2021 10:18 AM, Gyle McCollam wrote:
> > This is a lot different than your first explanation.  Under these
> circumstances where you sold the company electronic equipment, it is indeed
> just an expense.  On the company's books, it is the same as if the company
> had bought the equipment from any other vendor and would in no way be a
> "director's loan".  Treat it like any other expense on the company's books.
>
> Accounting, not gnucash, but .......
>
> a) This equipment, is it short lived? (expected to wear out in a year or
> so). Is it "consumables" used up in processing?
>

No. It's electronic test equipment, which is depreciated over a period of
5-years.

b) If not, do the rules of your jurisdiction allow you to immediately
> expense it? Or do they require you to treat this equipment as a fixed
> asset depreciating over X years (in other words, becomes an expense as
> it depreciates)
>

It needs to be depreciated.

Dave