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Re: Returning Security Deposits

On Thu, Aug 08, 2013 at 06:44:25AM -0400, Bill Ott wrote:
> Erik, suggested using a credit invoice. While the process seems a
> bit upside down, from a journal perspective it does what I need it
> to do. It debits the security deposit account and credits AR.
> "Receiving" a check from the customer in a negative amount (ie
> writing a check to the customer), debits AR and credits the checking
> account.  While I would have preferred crediting AP and processing a
> payment, i cannot see any reason not to use Erik's suggestion. Can
> You?

I was just asking about the ability to cut a check overriding the 
name and address.

IANAL and IANACPA (are these disclaimers still in vogue).

Erik's suggestion is good.  Keeping all of a customer's transactions
in one place is clear, easy, and efficient.

I'm just getting started with lsmb, so these comments are not based
on much specific knowledge of lsmb.

Without specific support in software for this stuff, I'd issue sales 
credits when receiving the funds.  I would date the credit
far in the future and periodically push them back.
Accrue interest on the escrow g/l account periodically; annually for
the tax man, with adjustments for payouts as they happen.  Redate
the credit when refunding the money.

There is a good case to be made for having this in another journal,
but with digital books it is really about what eases the work and
outputting reports that work.

The foundational accounting issue is whether the money goes through
Sales Revenue or not.  (A security deposit should not.) It seems 
wrongish, from an old-fashioned paper-based view, to have customer 
invoice/credits not go to Sales Revenue.  But now you would set your 
"Security Dep." item to apply to a different g/l account, removing the 
need to use another journal.


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