Allow me to add some more complexity. To test these samples when a sequence of transaction occurs, wherein the exchange rate might actually change over time, I've created a sample with 3 purchases in 3 different currencies (BRL, USD, and GBP). Default paypal account is EUR (all payments are automatically converted into EUR), but I want to settle in AED, locking the currency exchange rate in a way that does not expose me to that currency price anymore. To be more realistic, let's say I do that sort of "hedging" for only 2 out of my 3 purchases (sometimes I forget to settle). I found yet a 3rd possible way to represent this.
Option #1 2021/03/31 * KFC Expenses:Food 150.00 BRL {=0.6667 AED} Assets:Paypal -25.00 EUR 2021/04/01 * Currency Exchange Assets:Paypal 25.00 EUR Assets:Paypal -100.00 AED 2021/04/20 * Starbucks Expenses:Food 30.00 USD Assets:Paypal -20.00 EUR 2021/04/28 * McDonalds Expenses:Food 50.00 GBP {=5.4 AED} Assets:Paypal -60.00 EUR 2021/04/29 * Currency Exchange Assets:Paypal 60.00 EUR Assets:Paypal -270.00 AED Option #2 2021/03/31 * KFC Expenses:Food 150.00 BRL @@ 100 AED Assets:Paypal -25.00 EUR Assets:Paypal 25.00 EUR ; [=2021/04/01] Assets:Paypal -100.00 AED ; [=2021/04/01] 2021/04/20 * Starbucks Expenses:Food 30.00 USD Assets:Paypal -20.00 EUR 2021/04/28 * McDonalds Expenses:Food 50.00 GBP @@ 270 AED Assets:Paypal -60.00 EUR Assets:Paypal 60.00 EUR ; [=2021/04/29] Assets:Paypal -270.00 AED ; [=2021/04/29] Option #3 (new) 2021/03/31 * KFC Expenses:Food 150.00 BRL {=0.6667 AED} @@ 25 EUR Assets:Paypal -25.00 EUR Assets:Paypal 25.00 EUR @@ 100 AED ; [=2021/04/01] Assets:Paypal -100.00 AED ; [=2021/04/01] 2021/04/20 * Starbucks Expenses:Food 30.00 USD Assets:Paypal -20.00 EUR 2021/04/28 * McDonalds Expenses:Food 50.00 GBP {=5.4 AED} @@ 60 EUR Assets:Paypal -60.00 EUR Assets:Paypal 60.00 EUR @@ 270 AED ; [=2021/04/29] Assets:Paypal -270.00 AED ; [=2021/04/29] My question remains: 1) What is the difference between the above options? 2) What is the best way to record these transactions? Many thanks, Paulo On Tuesday, December 7, 2021 at 10:52:46 PM UTC+4 POliveira wrote: > Dear all, > I have been playing around with commodities because I frequently spend > money in different currencies and I then settle it with an internal > currency exchange within my own accounts. > > I would like to understand if the following 2 samples are exactly > equivalent or, otherwise, what distinguishes them. > > Sample #1 > > 2021/05/20=2021/05/22 * Starbucks > Expenses:Food 100.00 USD {=0.8 GBP} > Assets:Paypal -90.00 EUR > > 2021/05/31 * Currency Exchange > ; Starbucks payment settlement > Assets:Paypal 90.00 EUR > Assets:Paypal -80.00 GBP > > Sample #2 > > 2021/05/20=2021/05/22 * Starbucks > Expenses:Food 100.00 USD @@ 80.00 GBP > Assets:Paypal -90.00 EUR > Assets:Paypal 90.00 EUR ; [=2021/05/31] > Assets:Paypal -80.00 GBP > > What I am trying to record here is the following: > On May 21 I use my paypal card to pay a bill of 100 USD at Starbucks. > My paypal's default account is EUR, therefore it debits 90 EUR from my > wallet (automatic conversion). > My income is in GBP so I rather settle my expenses in that same currency, > therefore I do a currency conversion within my Paypall app, buying 90 EUR > with 80 GBP. Because this is a manual process, sometimes it happens only a > few days later (on May 31 in this example). > > Would you agree with my way of recording these transaction or would you do > it differently? > > Many thanks, POliveira > -- --- You received this message because you are subscribed to the Google Groups "Ledger" group. To unsubscribe from this group and stop receiving emails from it, send an email to ledger-cli+unsubscr...@googlegroups.com. To view this discussion on the web visit https://groups.google.com/d/msgid/ledger-cli/6ed686e2-b064-45cf-b853-bcd9df6b4db0n%40googlegroups.com.