David, Thanks for joining the conversation.
> If you make the Dividends Declared account a child account of Retained > Earnings ,i.e a contra account in accounting terms, any dividend amounts > will be automatically deducted from Retained Earnings as suggested on the > following site. > https://www.accountingcoach.com/blog/recording-dividend-payment. It does, except on GnuCash. Because GnuCash calculates Retained Earnings as Total income - Total Expense (which is nothing but net income). See attached screenshots. > They also > describe an alternative approach using an Expense: Divdends Declared to > record the declaration and this is closed to Retained Earnings at EoY > achieving the result you were after. This is not technically right. Dividends aren't Expenses. Recording dividends as Expenses do not decrease the Equity. Dividend payoffs should decrease equity. - Regards, Justin Mathew mjus...@protonmail.com Sent with ProtonMail Secure Email. ‐‐‐‐‐‐‐ Original Message ‐‐‐‐‐‐‐ On Wednesday, April 17, 2019 1:35 PM, David Cousens <davidcous...@bigpond.com> wrote: > Justin, > > If you make the Dividends Declared account a child account of Retained > Earnings ,i.e a contra account in accounting terms, any dividend amounts > will be automatically deducted from Retained Earnings as suggested on the > following site. > https://www.accountingcoach.com/blog/recording-dividend-payment. They also > describe an alternative approach using an Expense: Divdends Declared to > record the declaration and this is closed to Retained Earnings at EoY > achieving the result you were after. > > David Cousens > > > --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- > > David Cousens > > -------------- > > Sent from: http://gnucash.1415818.n4.nabble.com/GnuCash-User-f1415819.html > > gnucash-user mailing list > gnucash-user@gnucash.org > To update your subscription preferences or to unsubscribe: > https://lists.gnucash.org/mailman/listinfo/gnucash-user > If you are using Nabble or Gmane, please see > https://wiki.gnucash.org/wiki/Mailing_Lists for more information. > > ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- > > Please remember to CC this list on all your replies. > You can do this by using Reply-To-List or Reply-All.
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