Non-Cash Account

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dennisestoll
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Joined: Mon Jul 20, 2009 1:07 pm

Non-Cash Account

Post by dennisestoll »

I want to track donations made where the donor does not want tax credit. During Vacation Bible School, we a few people donate snacks and other items. Since our church did NOT spend any money for the items, I don't know how I can enter the expense and track that a non-cash donation was made. I want to know how much was spent for VBS, including those items that were donated, so we will know how much to budget for next year.

I have though about a non-cash asset account, but I don't know how I can clear the account at the end of the year.

Jeff
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Re: Non-Cash Account

Post by Jeff »

Typically for this type of entry you would credit an income account and debit an expense account. This increases the income and increases the expense at the same time.

dennisestoll
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Joined: Mon Jul 20, 2009 1:07 pm

Re: Non-Cash Account

Post by dennisestoll »

Have you done this? Can you provide an example of the accounts and postings?
How does this affect the month closing and year end closing?
To which account does the non-cash income account close?

JohnDMeyers
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Re: Non-Cash Account

Post by JohnDMeyers »

We do it by using a non-cash asset account.

DB non-cash asset
CR non-cash income

Doing it Jeff's way, the income and expense cancel out, so-to-speak, and you end up with a net gain of zero on your equity account. Therefore, you would want both your income and expense to close to unrestricted net assets.

If you want to record the non-cash donation as a gain in equity, then use the non-cash asset account.
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