Christian,
The difference you have noted about contributins to equity is a fairly
general one common to most jurisdictions and is primarily determined as you
point out by whether the contibution comes from the operation of the
business and subject to taxation in the hands of the business or is pro
For what it is worth, but for single person company in Denmark, there is a
distinction between the result of the company (income - expenses) and money you
put into or take out of the company (which relate to equity, as others have
pointed out).
When I started my company, I moved some money from
I do both.
I have a sole proprietorship that shares the same books with my personal
activities. At least in this state (Washington, USA), it is just me
doing business using a trade name. But, the trade name and I are the
same legal entity. In that case I just opened another checking account
at
Deposits into a checking accounts are debits in the books of the entity that
holds the account as an asset. (to your bank, your account is their liability)
Debits increase assets. Credits decrease them. (same goes for Expenses, but
reverse for Liabilities, Income & Equity)
Single Transaction
Are you mixing your personal and business in the same GnuCash file?
On 1/17/20 2:07 PM, Don Ireland wrote:
> What I was referring to is the checking account I use for my business. When I
> make what the bank sees as a deposit, I need to account for it in my books.
>
> My books includes an asset
What I was referring to is the checking account I use for my business. When I
make what the bank sees as a deposit, I need to account for it in my books.
My books includes an asset account called Business Checking. Wouldn't that
deposit be considered a credit? Based on what you've described, i
Speak to a local CPA for details for your situation and jurisdiction, but from
what you can find in a basic accounting text book, generally both contributions
(capital investments) and distributions (draws) are equity accounts.
The tree would look something like this:
Equity
|_Opening Balances
I'm having trouble figuring out the best way to handle owner contributions and
distributions in gnucash. I understand them in concept but I'm just confused
as to how the accounts get set up.
My 1st thought was to create an asset account called Owner Contributions and
another called Distributio
