[GNC] Tutorial and Concepts

[Michael or Penny Novack]

I have not been saying need to know much about double entry bookkeeping 
TO GET STARTED USING GNUCASH and the new user won't have to do much with 
equity beyond opening entries if never "closing the books" << much 
EXPLICITLY with equity -- accounts of type "income" and "expense" are 
actually type equity temporarily kept separate
  (their net DOES show up under equity in the Balance Sheet report*) >>

BUT (and this is a big but) the questions we get on this list are not 
about how to enter "I went to the convenience store and spent $X on gas" 
or even "I went to the convenience store and spent $X which was $Y on 
gas and $Z on food".

In other words, sooner or later will have a transaction to enter NOT so 
simple, will ask how, and NOW "you have to be willing to learn the 
basics of double entry bookkeeping".

Phyllis, there is nothing wrong for using gnucash for keeping just 
PARTIAL books as you seem to be doing. There is even a name from the old 
days for what you are doing, aka a "cash book".

Michael D Novack

* The item under equity  "retained earnings" or "retained losses" is 
actually "retained net of all income and expense accounts" -- earnings 
if credit and losses if debit



On 11/23/2024 12:38 PM, Phyllis Bruce wrote:
> Thanks, Mr. Losey for getting this particular ball rolling.  I don't have
> an accounting degree but I was a budget analyst for many years using
> various computer programs.  It is not necessary for many users to
> understand double entry accounting in order to use Gnucash.
>
> Whenever you spend money, you identify the source of the money (your bank
> accounts or credit cards or cash from your wallet.)  Those are your assets.
> You also identify what you spend it on and those are your expense accounts.
> You can usually identify one type of expense for each time you spend your
> money and that is called a transaction.  The money out will equal the item
> cost.
>
> Sometimes you want to be more detailed about your cost and that is where
> splits come into play.  Maybe you went to a gas station and purchased both
> gas and some groceries.  You have one expense from your assets (the total
> spent), and two "incomes" to your expense accounts - an increase in money
> spent on gas in one split, and an increase in food cost in the other.  The
> two splits will equal the money spent.
>
> That is the very basics of double-entry accounting and ignores equity if
> you don't care about it.  My gnucash file has only the starting balances of
> my bank accounts and cash, and the starting balances of my liability
> accounts - credit cards or loans.  These are the balances that existed the
> day I started using Gnucash.  They include any unreconciled expenses in my
> checking accounts and in my liability accounts.  All of these transactions
> were entered with their original dates so that I could balance the accounts
> when I received statements.
>
> I hope this helps using Gnucash less daunting.  Start with a practice file
> and see how that works.  Then you can create your good file to go forward.
> Any time I was trying something different in Gnucash, I would first play
> with it in my practice file.
>
> Pobruce