
<ARTICLE ID="XACC-ACCTYPES">
<ARTHEADER>
<TITLE>Account Types</TITLE>
</ARTHEADER>
<SECT1>
<TITLE></TITLE>
<PARA></PARA>
<PARA> GnuCash supports a number of different account types.  
Always choose the type that is appropriate for what you want to
record.  If you're not sure, the following explanations should help you
decide.

    <GLOSSLIST>
<GLOSSENTRY>
<GLOSSTERM><EMPHASIS>Cash</EMPHASIS></GLOSSTERM>
<GLOSSDEF>
<PARA>The <EMPHASIS>cash</EMPHASIS> account type is used to denote the cash
      that you store in your wallet, shoebox, piggybank, or
      mattress.</PARA>
</GLOSSDEF>
</GLOSSENTRY>
<GLOSSENTRY>
<GLOSSTERM><EMPHASIS>Bank</EMPHASIS></GLOSSTERM>
<GLOSSDEF>
<PARA>The <EMPHASIS>Bank</EMPHASIS> account type denotes savings or
      checking accounts held at a bank or other financial
      institution.
      Some of these accounts may bear interest.
      This is also the appropriate account type for check (debit) cards,
      which directly withdraw payments from a checking account.
      </PARA>
</GLOSSDEF>
</GLOSSENTRY>
<GLOSSENTRY>
<GLOSSTERM><EMPHASIS>Credit Card</EMPHASIS></GLOSSTERM>
<GLOSSDEF>
<PARA>The <EMPHASIS>Credit Card</EMPHASIS>account type is used 
      to denote credit
      card accounts, both for cards that allow floating lines of 
      credit (e.g. VISA, MasterCard, or Discover) 
      and with cards that do not permit continuing balances
      (e.g.  American Express)
      </PARA>
</GLOSSDEF>
</GLOSSENTRY>
<GLOSSENTRY>
<GLOSSTERM><EMPHASIS>Asset, Liability</EMPHASIS></GLOSSTERM>
<GLOSSDEF>
<PARA><EMPHASIS>Asset</EMPHASIS> and <EMPHASIS>Liability</EMPHASIS> accounts are used for
      tracking things that are of value, but that are not
      directly translatable into <EMPHASIS>cash</EMPHASIS>.
      For instance, you might collect the costs of purchasing a
      house into an asset account entitled <EMPHASIS>My
      House</EMPHASIS>, or the
      cost of a car into <EMPHASIS> My Car,</EMPHASIS> or collect together the
      value of your <EMPHASIS> Computer Equipment.</EMPHASIS>
      The home mortgage or car loan would be represented by
      liability accounts, <EMPHASIS> Home Mortgage</EMPHASIS> and <EMPHASIS> Car
      Loan</EMPHASIS>, to be drawn down as payments are made on these
      loans.
</PARA>
<PARA>
      If you hold assets for business purposes, their decline
      in value over time might be treated as a deduction for tax
      purposes, that deduction being called 
      <LINK LINKEND="XACC-DEPRECIATION">Depreciation.</LINK>
      On the other hand, if you own assets that 
      <EMPHASIS>appreciate</EMPHASIS> in value over time, such as real estate,
      collectibles like paintings, and investments like shares in
      companies, you may see them appreciate in value, and have to
      recognize, for tax purposes, what are called <LINK LINKEND="APPR"> Capital Gains.</LINK></PARA>
</GLOSSDEF>
</GLOSSENTRY>
<GLOSSENTRY>
<GLOSSTERM><ANCHOR ID="STOCKACCT"><EMPHASIS>Stock, Mutual Fund</EMPHASIS></GLOSSTERM>
<GLOSSDEF>
<PARA>Securities that you invest in are a form of asset that
      are normally acquired with the express purpose of receiving
      income either in the form of dividends, interest, or 
      <LINK LINKEND="APPR"> Capital Gains.</LINK> There are 
      securities markets around the world, and
      widely traded securities with fairly
      concrete values may be analyzed on a day-to-day
      basis.</PARA>
<PARA>
        Stock and Mutual Fund accounts are typically tracked in
        registers having three main columns: 

        <ITEMIZEDLIST>
<LISTITEM>
<PARA>Price </PARA>
</LISTITEM>
<LISTITEM>
<PARA>Number of shares </PARA>
</LISTITEM>
<LISTITEM>
<PARA>Cost </PARA>
</LISTITEM>
</ITEMIZEDLIST>
      </PARA>
<PARA>  In order to get <EMPHASIS>useful</EMPHASIS> information out of the
        register, it is necessary to have multiple "views" on the
        data so that you may assess such things as: 

        <ITEMIZEDLIST>
<LISTITEM>
<PARA>Total Values by security </PARA>
</LISTITEM>
<LISTITEM>
<PARA>Gains/Losses by security </PARA>
</LISTITEM>
<LISTITEM>
<PARA>Return On Investment rates by security </PARA> 
</LISTITEM>
</ITEMIZEDLIST>
      </PARA>
<PARA>More details may be found in the <LINK LINKEND="xacc-price-editor">price editor</LINK> and 
		<link linkend="xacc-price-sources">price sources</link>sections.</PARA>
</GLOSSDEF>
</GLOSSENTRY>
<GLOSSENTRY>
<GLOSSTERM><EMPHASIS><LINK LINKEND="XACC-INCOMEEXPENSE">Income,
      Expense</LINK></EMPHASIS></GLOSSTERM>
<GLOSSDEF>
<PARA><EMPHASIS> Income</EMPHASIS> and <EMPHASIS>Expense</EMPHASIS> 
     account types are used to record income and expenses.
     For example, if you deposit a paycheck in your bank account, you
should mark it as a transfer from an 'income' account.  
Marking income in this way helps balance the books: the change in your
net worth in the course of a few weeks, a few months, or a year, should
exactly equal your income (minus expenses) for the same period.  
The value stored in the bank account contributes to your 'net worth',
whereas the income contributes to your 'profits'.

</PARA>
</GLOSSDEF>
</GLOSSENTRY>
<GLOSSENTRY>
<GLOSSTERM><EMPHASIS>Equity</EMPHASIS></GLOSSTERM>
<GLOSSDEF>
<PARA><EMPHASIS>Equity</EMPHASIS> accounts are used to 
store the opening balances when you first start using GnuCash 
(or start a new accounting period).   
Assuming that you've had a bank
account far longer than you've been using GnuCash, and assuming you
don't want to type in old transactions, you will want to type in a
non-zero <EMPHASIS> opening balance </EMPHASIS>  into your bank account.  This opening balance
should be marked as a transfer from an account of type 'equity'.  
Alternately, if you close and reopen all your books at the end of every
quarter/year, the 'equity' will be your net-worth at the begining of the 
period: it equal all assets minus all liabilities.  
As time passes, you will have income and expenses. 
At the end of the year, your net
worth will be the equity at the begining of the year, plus all income
minus all expense.  This value then becomes the equity for
the next accounting period.
      </PARA>
</GLOSSDEF>
</GLOSSENTRY>
<GLOSSENTRY>
<GLOSSTERM><LINK LINKEND="XACC-CURRENCYHANDLING">
      <EMPHASIS>Currency</EMPHASIS></LINK></GLOSSTERM>
<GLOSSDEF>
<PARA><EMPHASIS> Currency Accounts</EMPHASIS> are used for trading
      currencies.
      In most ways, they behave like stocks, except that the
      only way that "income" may be gotten from them is from
      fluctuations in the relative values of currencies. Note that
      transfers cannot be made directly between two accounts
      denominated in different currencies. Such transfers may only
      be made into currency trading accounts.</PARA>
</GLOSSDEF>
</GLOSSENTRY>
</GLOSSLIST>


</PARA>
</SECT1>
</ARTICLE>

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