Re: [SL] DIY Accounting

[Wallace R. C. <wrc...@gm...>]

On 12/8/06, Paul Witt <pau...@ox...> wrote:
...
> Scenario: A credit card company has sent a statement, with a "minimum
> payment" amount and a "must be received by" date.  Since no interest
> is currently being being charged by that card company, the intention is
> to pay them the minimum payment from a bank account a week before the
> "must be received by" date.  The credit card account exists under "long
> term liabilities" and the bank account exists under "current assets".
>
> What I actually end up doing in this situation is creating a general
> ledger entry showing a credit to the bank account and a debit to the credit
> card account for the same amount.  This basically represents the transfer
> that has taken place, but it doesn't record anything about the statement
>  / request for payment that was sent out.  In a way their statement is
> a bit like an invoice in that they're asking for payment, but it's not
> really an invoice because it's not for goods or services; from my point
> of view it's an internal transfer between an asset account and a liability
> account.

Actually, the statement that they (the credit card company, usually a
bank) sent to you is a record of all the goods / services that you
purchased on your credit card; an invoice, if you will.  So, if you
set it up as an invoice, I think the accounting will work just fine.

> Before I witter on too much, I suppose the question is: in this situation,
> is there a better way of representing the payment than via a GL entry?

See above.
-- 
Best Regards,
Wallace