gnuGord, If you have ownership, possession and/or control of your house and car or any other resource then they are assets. Bank accounts are also assets for example. Your furniture, a boat, camper etc are all assets.
If you have taken a loan out to buy them, the present value of that loan is a liability, usually against that specific asset (e.g. mortgage) or your assets in general, i.e. you are obligated to pay it back with loss of the asset or a considerable fraction of its value a likely penalty if you don't. Any obligation you have to pay someone else some amount of money is a liability. Your equity in the house and car is the difference between their present value as assets and the outstanding liabilities against those assets. In most cases the cost of an asset is used to record its value as until you have sold it you do not have a definite value to ascribe to it. It is possible to track market values (unrealized gains and losses) on assets but it will be better to leave looking at this until you have the basic accounting under control. Each jurisdiction has rules re reporting of unrealized gains and losses and these can be quite variable). The only entries you normally make to equity as Stephen said are when you enter the opening balances of your assets and liabilities and if you close the temporary equity (Income and Expenses) accounts to equity ( this is not necessary in GnuCash but may be for external accounting procedural purposes). The transactions to add the value of an existing asset is normally: 1. a debit to the asset account for the present value of the asset and 2. a credit entry to the equity opening balances account (or an appropriate subaccount of the opening balances for that specific asset if you require that level of detail) and to add a liability 1. a credit to the liability account recording the liability and 2.a debit to the opening balances sub account of equity (or again a sub account of that depending on the detail you require, i.e. if you need to know the equity you have in specific assets. These are the individual lines (or splits) of a single transaction. If you select View->Auto Split Ledger from the menu then each transaction in a register of an account will open up to display the individual lines/splits composing it. See https://code.gnucash.org/docs/C/gnucash-guide/chapter_basics.html for a very basic introduction to accounting. The Wikipedia articles on Double Entry, debits and Credits and basic accounting are pretty good as well. Otherwise a reasonably recent second hand textbook on financial accounting is a good investment for the basics. 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.
