I forgot to mention, my inclusion of ‘Assets:Receivables’ was NOT the special A/R account used by the business features, but a manually created Asset account. (of type Asset, NOT of type A/R)
You could possibly use the business features instead as the other comments note, but you’ll have to do that request for reimbursement separate from the crediting of the original expense rather than all in one transaction. Regards, Adrien > On May 13, 2018, at 10:33 PM, Adrien Monteleone > <adrien.montele...@lusfiber.net> wrote: > > I’ll start off with this: you really need to talk to a CPA. > > Now, here’s how I would approach this... > > > > The answer you are looking for involves both real and virtual entries, so > you’ll need more accounts if you want to do this all in GnuCash. (you could > alternatively track the MRA balance in a spreadsheet) > > Where you place those accounts is somewhat flexible, and a matter of personal > preference. (if you aren’t concerned with being a stickler, or required to > follow certain accounting rules) > > You already have an Assets:Cash, or Assets:Checking account, and an > Expenses:Medical account. > > The MRA is NOT an asset, as you have no claim to it, can’t control any funds > in it, and can’t spend directly from it. It is a predetermined expense > ALLOWANCE and thus a contra-expense account. Borrowing from business books, > the analogy would be a Purchase Allowance account which offsets expenses or > inventory as needed. As an individual, you could place this account right > under expenses as its own thing, or place it under Expenses:Medical. You can > either have a parent to collect all of the MRAs or just list them > individually, that’s up to you. > > For example: > > Expenses:Expense Allowances:MRA XYZ > Expenses:Expense Allowances:MRA ABC > > or > > Expenses:Expense Allowance MRA XYZ > Expenses:Expense Allowance MRA ABC > > or > > Expenses:Medical:Expense Allowances:MRA XYZ > Expenses:Medical:Expense Allowances:MRA ABC > > or finally, > > Expenses:Medical:Expense Allowances MRA XYZ > Expenses:Medical:Expense Allowances MRA ABC > > It’s up to you if you need that intervening parent account to track overall > totals or not. > > > When the employer funds the MRA XYZ, you’ll need another special account, so > do this: > > Dr. Equity:Reimbursable Expenses > Cr. Expenses:Medical:Expense Allowances:MRA XYZ > > > Alternatively, you could: > > Dr. Revenue:Reimbursable Expenses > Cr. Expenses:Medical:Expense Allowances:MRA XYZ > > > (I relabeled ‘Income’ to ‘Revenue', but it doesn’t matter in this context, > I’ll get to why this placement in revenue/income works out later.) > > As before, when you pay out of pocket: > > Dr. Expenses:Medical > Cr. Assets:Cash/Checking > > > When you request reimbursement from the allowance account: > > Dr. Expenses:Medical:Expense Allowances:MRA XYZ > Dr. Assets:Receivables > Cr. Expenses:Medical > Cr. Equity/Revenue:Reimbursable Expenses > > (If you have other receivables, you could create a sub-account or a different > asset account labeled 'Reimbursements Pending’) > > > When you receive the reimbursement: > > Dr. Assets:Cash/Checking > Cr. Assets:Receivables > > > The advantage to placing the MRAs under the Expenses:Medical account is to > see a roll-up total. If you don’t need that, they can be their own expense > account/set of expense accounts. > > It won’t matter if the offsetting account to funding (and receiving > reimbursements from) the MRA is revenue/income because it always washes out > with no net affect on your taxable income. (it’s a contra-revenue account > balanced by a contra-expense account, which you can cancel out manually at > the end of the year if you feel the need.) > > If you think it might be a problem somehow, then place it under Equity > instead. (which is acceptable, since expenses and revenue would close-out to > Equity if you performed a close-books procedure) > > With that in mind, to keep things neat and tidy, you might want to set up the > MRAs under Equity as well, instead of under expenses, like so: > > Dr. Equity:Expense Allowances > Cr. Equity:Expense Allowances:MRA XYZ > > (notice this would have a net zero effect on Equity) > > If you had a need to maintain the MRA balance in perpetuity AND wanted to see > a running total of all ‘draws’ against that allowance, instead of issuing a > debit to the MRA, debit a sub-account of it labeled ‘draw’: > > Dr. Equity:Expense Allowances:MRA XYZ:Draw > Cr. Expenses:Medical > > With this method, the actual MRA XYZ account never goes to zero, but the Draw > sub-account which also never goes to zero but is the opposite balance, rolls > up into it’s total to make it appear that way on the CoA and reports > (depending on your options selected) AND you get to see a total draw from > that account, but if these aren’t ongoing accounts or if you don’t have a > need for such detail, just use the first transaction method I listed. > > Questions? > > Regards, > Adrien > > >> On May 13, 2018, at 9:07 PM, randix <butterands...@gmail.com> wrote: >> >> Thanks for your suggestion. >> >> Unless I'm misunderstanding, what you propose would work fine if one was not >> interested in keeping track of the current balance(s) in the various MRA >> accounts. I need to keep track of the balances, as I need to know which MRA >> account still has credit balances to which I can submit claims. >> >> So, for example, using your suggestion... >> >> 1. On January 1, 2018, I'm notified that I have received $1,000 which has >> been deposited in my XYZ MRA Account (keep in mind, these are not funds that >> have been actually sent to me, rather they have been deposited in an account >> set up in my name). I have an ASSET account in the name of XYZ MRA, so on >> January 1, 2018, when notified of the deposit, I make a "deposit" in that >> asset account in the amount of $1,000, and offset it with $1,000 in an >> income account titled MRA income (so I can keep track of MRA funds that have >> been credited to me in all MRA accounts). >> >> 2. On January 5, 2018, I pay out of my checking account the sum of $100.00 >> to Doctor 123, the offsetting entry is expense:health:medical >> >> 3. Using your suggestion, on January 10, 2018 when I file a claim for >> reimbursement of the $100.00, I debit the ASSET XYZ MRA account, so it now >> has a balance of $900.00, and credit the $100.00 in my >> expense:health:medical account. All good. >> >> 4. *The issue is what happens when I actually receive the reimbursement in >> my checking account. * >> >> 4.1 You said, "Receive reimbursement. Deposit into checking account. Debit >> checking, credit MRA". Not exactly clear what you meant, except that I get >> you want a credit to end up in the MRA account. But doing so, will bring >> the balance of the MRA account back up to $1,000 when we know there's only >> $900 in there...if that account had a zero balance to start with, your >> debit/credit approach would work fine. But I need to have it track the >> balances. >> >> Suggestion? My head is starting to spin :) >> >> >> >> >> >> >> -- >> 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. >> > _______________________________________________ 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.
