can income account be used for an expense?

liz78644 · Post by **liz78644** » Thu Aug 24, 2006 12:49 pm

Our church recieved some money for a damaged roof. Money was put in an income account 4700. Now we are paying the roofer. Can i take the money from 4700 or create an expense account and transfer the money there, then pay the roofer from that account. Is one way or the other better or does it matter? Thanks.

Matt · Post by **Matt** » Thu Sep 21, 2006 9:14 pm

You need to create an expense account. Then, when you pay the roofer you debit the expense account and credit your checking account. There is no need to "transfer" the money. When the repairs are complete you will see two lines on your income and expense statement: an income line under account 4700 showing how much money you received and an expense account showing how much money was spent to repair the roof.