[GNC] Income not appearing in P&L report

[Michael or Penny Novack]

On 3/31/2021 3:45 AM, Mahon Finbar wrote:
> Thanks both.
>
> Thanks for the 'accounting' way of doing it and I will try some of the 
> proposals.
>
> My case is a little bit different; just to clarify - I pay a fixed 
> amount per month, as many utilities suppliers offer, but, my supplier 
> cannot (yet) handle the reduction from a government subsidy, on age 
> grounds, so the authorities pay that monthly. Therefore I have two 
> transactions, paying the fixed amount and receiving the subsidy as an 
> "income" event. Slight wrinkle, the subsidy is, for reasons I do not 
> understand, different every month, there is a higher and a lower sum 
> every second month. 😕 

a) Does your jurisdiction consider that subsidy income? << do you need 
to report that as income? >> If not (and I suspect not)

b) Look at the expense side of this. I am guessing, when you send this 
utility supplier that fixed monthly payment you are recording THAT as 
"utility expense". But then somebody (the government agency) reimbursed 
part of that to you. Now IF your government and this utility had been 
able to arrange your age related reduction in charge for the utility 
service, what would you have seen? You'd have had a lesser monthly 
payment to make, right?

     So treat this reimbursement you get not as income but as a 
reduction in utility expense. You debit cash for the subsidy and credit 
utility expense.

Michael D Novack