On Fri, Nov 6, 2015 at 12:29 PM, danc2 <[email protected]> wrote:
> Hi all, does ledger support contra asset accounts? > > I need to write off a bad loan I made. I'm not an accountant, but it looks > like using a contra asset account is the way to handle these. Using an > expense account works (thanks sm!), but I'd like to keep it as an asset > (with a negative balance) > > Any suggestions? > Ledger (& Beancount) use the convention that amounts are posted to accounts in their absolute value, that is, accounts aren't all kept at a positive value. No credits and debits. Assets are positive, Liabilities negative, Income is negative, and Expenses positive. This removes the set of somewhat confusing rules about how to post to different accounts and makes the operations simpler (on the other hand, users have to understand and remember that the "normal" balance sign of Income, Liabilities and Equity accounts is a negative number). Therefore, a "contra-account", which in normal accounting terms is "an account whose normal balance is negative" becomes, in the context of Ledger, "an account whose normal balance is of the opposite sign as the expected one." That is, an Asset account with a negative balance, or a Liabilities account with a positive balance. Account balances aren't constrained to be positive, so AFAIK any account can be used like a contra account, just post to it to make its balance opposite. e.g. debit from an Assets account into negative territory. I hope this helps. > > Thanks! > > > -- > > --- > You received this message because you are subscribed to the Google Groups > "Ledger" group. > To unsubscribe from this group and stop receiving emails from it, send an > email to [email protected]. > For more options, visit https://groups.google.com/d/optout. > -- --- You received this message because you are subscribed to the Google Groups "Ledger" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. For more options, visit https://groups.google.com/d/optout.
