You regretfully decline.Īfter retrieving your password, you get the money from a very generous ATM and hand it to your roommate. You check your GnuCash register and see that you have £1150 in the bank, but then notice the liability, and see that your net worth is only £30 pounds. That Saturday, on the way to your mum's house to get the password, someone offers to sell you a copy of Dance Dance Revolution for $50. Your bank account still has £1150, but your net worth has declined by £1120 - because you have a debt. Note that no money has changed hands here, but you have accounted for the expense, because you incurred it by promising to pay. At the start, your bank account has £1150 Account Debit Credit You don't have your bank password, but you DO have access to GnuCash, so you decide to book the liability now so you don't forget. Can I pay you next Saturday when I ask my mum what it is?" "Sure." "Oh no, but I don't have my bank password. "You owe me money for rent, food, and utilities". Most people don't actually do what I'm about to show you in their personal finances, but it gives you some idea how accrual accounting works. Here's a more complicated example that shows liabilities in use. I'd expect the right transaction to look like this: Account Debit CreditĨ50+180+90 = 1120, 1120 gets removed from your checking account. Since you're actually paying money to your partner, you don't owe it - it's an expense. No money actually gets withdrawn from my actual starting balance like I'm hoping it to.Ī liability is something you owe. If I continue down with splitting, and assign the £850 to "Liabilities: Rent", the £180 to "Liabilities: Food" and the £90 to "liabilities: Utilities", it all comes out of this Imbalance deposit. The problem I'm experiencing is when I hit "Split", the £1120 gets deposited into "imbalance GBP", making my entire account balance £2683.8. This comes out of that account as expected. I select transfer account "liabilities Utilities", and then enter £1120 in the withdrawal section. On my checking account, I enter a transaction with the description "Property". This is what I'm trying to replicate on GNUcash. Monthly,I transfer to my partner one lump sum of £1120, however, this is split between 850 rent, 180 Bills, 90 Utilities. I'm starting with an opening balance of £1563.80. I've watched many tutorials on split transactions via youtube and unfortunately I just can't seem to figure out why if I do exactly what the video says, I still get a different result. I've been using GNUcash for about 2 weeks now for personal finances.
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