On Fri, 21 Apr 2000 16:23:56 +1000, the world broke into rejoicing as
Paul Fenwick <[EMAIL PROTECTED]> said:
> G'day Jason,
>
> On Thu, Apr 20, 2000 at 11:20:33PM -0500, Jason Godfrey wrote:
>
> > I am thinking about setting up some sort of Accounts Payable acount. When I
> > get the bill for my rent, I would apply the amount to the Expense : Rent
> > account and transfer from the Accounts Payable account. Then when I actuall
y
> > write the check to pay the rent I would enter a transaction between the
> > checking account and the Accounts Payable account.
> >
> > Is this the correct approach? This seems useful - I would be able to tell h
ow
> > much I owe in outstanding bills, but it also seems redundant.
>
> I'm not an accountant, but what you've described is the approach that I use
> and I find that it works very well. Double-entry makes is very difficult
> to `lose' money, and if I didn't use it I would have a much harder time in
> keeping track of my finances.
As documented (I'm going to be a broken record, here...) in xacc-apar.html,
yes, this is an appropriate approach.
For individuals, it is not usually of _great_ value to go to this much
detail. Tracking expenses via accounts payable results in there being two
transactions, as opposed to the _one_ you'd have by treating it as a
"cash" transaction by just issuing a cheque.
> > If this is the right approach, would it make sense to have a seperate sub
> > account for each company I get bills from? IE have a sub account for the
> > gas company, the phone company, the electric company?
>
> It makes sense if you want to know information down to that level of
> detail. For example, I usually pay my bills pretty quickly and so
> only have a single `Accounts Payable' liability account. However,
> I want to keep tabs on how my phone, water, and other bills change,
> so I have seperate expense accounts for each type of utility.
>
> If I wanted a better idea of where my accounts-payable lie, then I would
> break it up into sub-accounts.
>
> Hope that you've found the above useful,
And this sort of stuff shouldn't matter much to "average individual."
Frankly, the way "average individual" manages this is by having a credit
card, charging the expenses to the credit card, and then, once in a while,
issuing a cheque to pay off the credit card bill.
--
Actually, typing random strings in the Finder does the equivalent of
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intuitiveness of commands: file completion vs. the Mac Finder.)
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