[GNC] Tracking UnPaid Bills

Murugan Mariappan m.muruganandam at hotmail.com
Tue Mar 18 14:18:50 EDT 2025 

Here's the journal entry breakdown
1. Phone Bill Entry

  *   Increase: Phone Expense → $150.00 (Recording the expense)
  *   Increase: Liability (To Pay) → $150.00 (Recognizing the amount owed)

📌 This entry records the phone bill as an expense and creates a payable liability.
________________________________
2. Bill Payment

  *   Decrease: Liability (To Pay) → $200.00 (Reducing the amount owed)
  *   Decrease: Bank (Asset) → $200.00 (Cash outflow for bill payment)

📌 This entry clears the liability by making a payment from the bank.
________________________________
3. Reversal Entry

  *   Increase: Bank (Asset) → $50.00 (Restoring funds to the bank)
  *   Decrease: Liability (To Pay) → $50.00 (Reducing the amount owed)

📌 This entry reverses part of the bill payment, possibly due to an overpayment or adjustment.

Is this what you are explaining






Saludos Cordiales


Murugan

________________________________
From: gnucash-user <gnucash-user-bounces+m.muruganandam=hotmail.com at gnucash.org> on behalf of Derek Atkins <derek at ihtfp.com>
Sent: 18 March 2025 14:22
To: griffin <griffin at bernevyl.com>
Cc: gnucash-user at gnucash.org <gnucash-user at gnucash.org>
Subject: Re: [GNC] Tracking UnPaid Bills

Hi,
You are doing something wrong.  So let me ask you a question:

How does the refund work in real-life?

My guess is that the refund is actually a "reduction of expense" --
because it's coming from the Vendor directly.  It should probably not hit
the liability account at all, unless the goal is the reduce the amount you
owe to the vendor.  So either it is:

  Expense -> Liability   (reducing how much you owe)
or
  Expense -> Bank  (they sent you a check and you deposited it).

-derek

On Tue, March 18, 2025 1:12 pm, griffin wrote:
> Sorry, but I'm still having an issue with this process.
>
> Setting the bill value as a transfer from the expense account to the
> liability account is working fine, as is paying off the liability from
> the chequing account.
>
> However, dealing with a refund is still causing a problem.
>
> 1.) If I make a deposit into the chequing account from the liability
> account, Gnucash makes the balance of the liability account go up, not
> down towards zero. Making the value a negative number, only results in
> the value moving to the other column (see the second point).
>
> 2.) If I make the transfer from the liability account in the decrease
> column, setting the balance to zero, the transaction appears in the
> chequing account as a withdrawal.
>
> This is all controlled by GnuCash. Am I doing something, or is GnuCash
> doing something of which  I'm not aware.
>
>
>
> On 2025-03-17 12:01 p.m., griffin wrote:
>> I have been trying this, and I've hit a small issue.
>>
>> I made an over payment to my phone bill, and then moved to another
>> carrier, so I was over paid in the liability account.
>>
>> When I tried to "refund" this overpayment to my chequing account
>> GnuCash either doubles the liability, or withdraws the refund from the
>> chequing account.
>>
>> (...and yes, I feed my dog Dog Foof!!!😳)
>>
>> I don't seem to be able to reduce the liability to zero, and increase
>> the chequing account balance.
>>
>> What have I done wrong?
>>
>>
>>
>>
>>
>> On 2025-03-17 10:56 a.m., R Losey wrote:
>>> On Sun, Mar 16, 2025 at 11:56 AM Michael or Penny Novack via
>>> gnucash-user <
>>> gnucash-user at gnucash.org> wrote:
>>>
>>>> On 3/16/2025 12:13 AM, R Losey wrote:
>>>>> Hi. I'd just set such accounts up as sub-accounts under Liabilities.
>>>> Using
>>>>> your example (electricity)
>>>>>
>>>>> 1) Create an "Electricity" account under "Liabilites"
>>>>> (alternatively, you
>>>>> could use the provider as the name of the account
>>>>> 2) Using your $120 bill as an example, when you pay $60 and owe
>>>>> them $60,
>>>>> you'd create a three-way split
>>>>>          Checking: decrease (credit) $60
>>>>>          Expenses->Utilities->Electricity: increase (debit) $120
>>>>>          Liabilities->Electricity: increase (credit) $60
>>>> You COULD do it that way. Splits when paying the bill.
>>>>
>>>> But I suggested entering the expense/liability when the bill arrives
>>>> with an effective date the due date of the bill. Then when you pay all
>>>> or part of the bill, the transaction just liability/bank account. No
>>>> split transactions involved. (well MAYBE no splits -- besides being
>>>> billed for electricity might also have late fees and/or interest
>>>> charges. You MIGHT just bundle those into electricity expense but also
>>>> might instead might want to see how much you are being hit with late
>>>> fees and interest on all your bills).
>>>>
>>>> Michael D Novack
>>>>
>>>> Your suggestion is even better and simpler (no splits); I was trying
>>>> to
>>> think of how to do it the way you suggest, but somehow confused
>>> myself and
>>> couldn't figure out what the two transactions would look like. (I don't
>>> know what I was thinking; it's perfectly obvious today).
>>>
>>>
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--
       Derek Atkins                 617-623-3745
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