Revenue is money you have collected. I don't think an invoiced amount is revenue until it has been collected. When a payment cannot be collected, that uncollected payment is not an expense. An expense is revenue spent in exchange for a good or service.
Kind regards, Greg Feneis (Galaxy S7) On Tue, Apr 9, 2019, 16:47 Adrien Monteleone <adrien.montele...@lusfiber.net> wrote: > > > > On Apr 9, 2019, at 6:07 PM, Greg Feneis <mfen...@gmail.com> wrote: > > > > Since people are trying to associate a non payment with an expense > account, does not getting paid by a customer actually constitute an expense? > > Generally, yes, it is revenue earned, but needs to be deducted so as not > to affect income because it wasn’t actually collected. > > Income = Revenue - Expenses (accounting text book definition) > > > > > I imagine in business, the big concerns with expenses are tracking where > the revenue that doesn't become profit goes, and (at least in the US) > getting tax deductions for as many deductible expenses as possible to > minimize tax liability. > > Non-collectible receivables are reductions to Income in a similar way that > Discounts and Allowances are. One way to do that is via an Expenses:Bad > Debt account. (again, generally) > > > > > As a sole proprietor, I think when I can't collect an invoiced amount, > that's just income I can't receive. I don't think it's an expense. It's > not revenue spent on something, and it's not tax deductible, AFAIK. > > Depends on your jurisdiction tax laws and the exact legal form of the > business. > > > > > Sorry, I don't mean to hi-Jack the thread, it's kind of related. > > > > > > > > > > Kind regards, > > > > Greg Feneis > > Certainly, related, but the answer for any specific situation should be > given by a competent local CPA. My recommendation was for the generic > formal treatment of the situation. > > We don’t give actionable tax or accounting advice here, but rather how to > accomplish accounting tasks using GnuCash. > > Regards, > Adrien > > > _______________________________________________ > 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.