Davids, John This is just an aside for terminology clarification and being a trifle pedantic.
Although the meaning is clear where you have used contra in this context, the term contra account is generally used in accounting with a very specific meaning which is unrelated to the usage here to describe the account which is debited or credited in the second split. The general use is to describe a situation where one has an account whereone needs to preserve the original value and simulataneously record changes in that value. For example the purchase price of an asset, where that asset is subject to deprectiation. One normally sets up a structure similar to the following Asset:Plant Asset:Plant:Initial Cost Asset:Plant:Depreciation where Asset:Plant is a Placeholder into which the two sub accounts sum. Asset:Plant:Depreciation is what is usually referred to in accounting as a contra account because in most cases, but not always, the balance in this Depreciation account is increased by credits to the account, i.e. it has a credit balance wheras the Asset:Plant placeholder and Asset:Plant:Initial Cost accounts have a debit balance and the balance is increased in them by debits to the account. The overall balance of the Asset:Plant account is determined by the Initial Cost - Depreciation. There are lots of other situations where a contra account is used in this way in accounting, mainly to preserve information which will be required in the future for assessing things like capital gains tax or profit or loss on a particular item. I have often tried unsucessfully to think of a more appropriate terminology for the other accounts referred to in balancing a transaction. Elsewhere in the GnuCash documentation it is sometimes referred to as a transfer account which is as appropriate a description as I have been able to find in any accounting text books. David Cousens ----- David Cousens -- Sent from: http://gnucash.1415818.n4.nabble.com/GnuCash-User-f1415819.html _______________________________________________ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user If you are using Nabble or Gmane, please see https://wiki.gnucash.org/wiki/Mailing_Lists for more information. ----- Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
