> That's what was causing me confusion. I had this entire debit/credit
> tree written out, trying to decide if account x was an asset or
> liability account, so that I would know whether transaction y was a
> debit or a credit in that account.
Correct me if I'm wrong, but I -think- it works fine if you think of
the "debit" as being the destination of the money, and "credit" as
being the source.
Using the original payroll example:
Account Debit/Destination Credit/Source
-------------------------------------------------
Checking $900
Tax:Federal 75
Tax:State 25
Salary Income $1000
------- -------
$1000 $1000
======= =======
$1000 is coming from your income, and going into checking and taxes.
More generally,
DR CR
--------------
xxxxx $1000
yyyyy $1000
------- ------
$1000 $1000
======= ======
The money is going from yyyyy (the source/credit) to xxxxxx (the
destination/debit). From a data-entry standpoint, it doesn't matter
if xxxxx is a bank deposit (asset increase), service purchase (expense
increase), a debt payment (liability decrease), a refund (income
decrease), or a draw (equity decrease). It's still the destination of
the money being transferred. It doesn't matter if yyyyy is a bank
account (asset decrease), correction of an overcharge (expense
decrease), a new loan (liability increase), a sale (income increase) or
closing the books on a profit (equity increase).
I would -love- to hear what's wrong with this approach. It seems
simpler to remember than the traditional method, and I've never heard
it before.
>
> I still haven't figured out how to use our bucket system with this
> decidedly accounting approach to home finances.
>
> rob (thankful for an accounting minor _now_!) walker
>
> --
> Gnucash Developer's List
> To unsubscribe send empty email to: [EMAIL PROTECTED]
>
>
--
Buddha Buck [EMAIL PROTECTED]
"Just as the strength of the Internet is chaos, so the strength of our
liberty depends upon the chaos and cacophony of the unfettered speech
the First Amendment protects." -- A.L.A. v. U.S. Dept. of Justice
--
Gnucash Developer's List
To unsubscribe send empty email to: [EMAIL PROTECTED]
