What is "Expense: Adjustment"?

Mike or Penny Novack stepbystepfarm at mtdata.com
Wed Apr 16 05:34:34 EDT 2008


>Hello,
>
>I'm new to this list. 
>
>My version of GnuCash came pre-installed with a number of different accounts, and one of them was an expense account called "Adjustment." I don't really understand what purpose this account was intended to serve. Anybody know?
>
>I searched the documentation and the archives, but was unable to find an explanation.
>
>I'm running GnuCash 2.0.5 via X11 on Mac OS 10.4.11. 
>
>Thanks,
>Gabriel
>
>  
>
An accounting question not a GnuCash question, so you wouldn't find an 
answer in the GnuCash documentation or archives. The "introduction to 
accounting" provided is elementary, covers just the basic concepts of 
"double entry bookkeeping", not all topics you would eventually need to 
know. You can ignore the adjustment accounts until such time as you find 
yourself in a situation where you need one (you'd then be asking "how 
the heck do I enter THIS transaction") or you could look in some 
"Accounting 101" books in the index to find topics on "adjustment".

But I'll give you an example. Suppose that in 2008 you received a rebate 
on one of the expenses you paid in 2007. How do you suppose you would 
"book" that? It's a reduction of 2007 expenses but the books for that 
year have been closed. If you had a great many rebates coming in for 
specific expense accounts, you might have a "rebates" for each of them, 
but more likely rebates are rare enough that a single expense 
"adjustment" account would be more sensible.

There are of course other sorts of adjustments.

Michael

Michael

-- 
There is no possibility of social justice on a dead planet except the equality of the grave.



More information about the gnucash-user mailing list