Hi Buddha, Thanks for the reply,Now I understood may be it is not a general accounting practice. To my requirement i am not required to record double entry, I know that i am spending from my pocket there is no need for income or profit and loss statement, I just want to track my Expenses. and accounts Payable.
To my requirements, Instead of general accounting practice can i create a liability type account under an expense type parent account at-least in single entry accounting practice If i required to do so can i change any global settings to do so in GNU Cash. Regards. On Fri, Nov 24, 2017 at 1:33 AM, Buddha Buck <blaisepas...@gmail.com> wrote: > You should talk to your accountant about how to set up your accounts to > handle this type of transaction. Your proposed solution (a liability > account under the concrete expense account) is not how I would do it, and I > believe is generally not considered the proper method of doing it. Things > may be different according to the common accounting practices of your > jurisdiction, which is why you should talk to your accountant, and not to > us, about how to do it. > > Expense and liability accounts are very different things. They do not show > up together on the same reports, they measure different things (expenses > measure what money is spent on, liabilities measure money is borrowed from > other people), and they have different balances (expenses have debit > balances, liabilities have credit balances). They can't generally be mixed > or added together. > > In general, in GnuCash and other accounting packages I've worked with, > sub-accounts must be the same general "type" (asset, liability, income, > etc) as their parent account. The value/balance of the parent account > includes the balance of the child accounts. When you see an account name in > GnuCash like "Expenses:Non-Taxable:Charity:Church" That implies that > there are total expenses, some of which are non-taxable, some of which are > charities, some of which are to the church. The total non-taxable expenses > includes those going to charities like your church, your local Makerspace, > the local soup kitchen, as well as non-charitable non-taxable income like > (in the US) mortgage interest or healthcare. Putting a liability account in > such a roll-up would not make sense. > > For your situation, I would have an A/P liability account completely > separate from the Material Expenses hierarchy, and when I received an > invoice for cement, I would create a transaction that debited the cement > expense account and credited the A/P liability account. Then, when I paid > the bill, I would create a transaction that debited the A/P liability > account and credited the associated cash/banking account. > > If you use the "Business Features" within GnuCash it will handle the > details in the previous paragraph semi-automatically, including creating > the A/P account. > > > On Thu, Nov 23, 2017 at 2:30 PM Suresh Saragadam < > saragadamsur...@gmail.com> wrote: > >> I am working on a small construction work where i need to record my >> expenses for both material and men (labour) >> >> Initially i need to create expense accounts for >> >> sand, stone,cement, under Total Material Expences >> >> Total Material Expences >> |_sand >> |_cement >> |_stone >> >> i am purchasing cement on credit(Loan) that is accounts payable i.e. >> liability >> >> Here i need to create liability account for cement under material >> expenses, >> but i am unable to create a liability account for cement under material >> expense account >> >> so that i can record total material spend including liability for cement >> >> this is very minimum accounting requirement. >> >> Regards >> >> Suresh >> _______________________________________________ >> gnucash-user mailing list >> gnucash-user@gnucash.org >> https://lists.gnucash.org/mailman/listinfo/gnucash-user >> ----- >> Please remember to CC this list on all your replies. >> You can do this by using Reply-To-List or Reply-All. >> > _______________________________________________ gnucash-user mailing list gnucash-user@gnucash.org https://lists.gnucash.org/mailman/listinfo/gnucash-user ----- Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
