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I do not understand nor do I enjoy accounting. I have a small LLC, and I have a QFX file from my bank that encompasses all transactions from 2013. I would like to import this, manually categorize transactions (payments to myself and my partner, expenses, income from our CC processor, and income from checks). The bank account record is accurate, no need to reconcile.

When everything is categorized, I would like to generate a report that I can hand to our tax preparer that simply shows how much money was received, spent and paid to each partner.

This seems incredibly difficult. I have a screenful of "imbalanced" transactions, and I'm warned of dire consequences if I alter what I believe is the category (column labelled "Transfer"???).

Is there a "gnucash for idiots" resource out there somewhere? The business is very simple, and I really only need perhaps 1% of the features available here.

  • Welcome to Money.Stackexchange.com sporker! I've struggled to get to use gnucash myself, but it's a good tool. Please take a look at our About (it's like a tour) when you get a chance. – C. Ross Jan 3 '14 at 3:18
  • You need to understand the concepts of double-entry accounting to use GnuCash. If it is too troublesome for you, try a simpler tool (Quicken?) that doesn't require double entry bookkeeping. However, once you figure out the double entry system - your life (and the life of your tax preparer) will become much much easier (and cheaper, if the preparer bills you per hour). – littleadv Jan 3 '14 at 4:07
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The official guide can be found here, but that can be a little in depth as well. To make good use of you need at least a little knowledge of double-entry bookkeeping.

Double-entry bookkeeping, in accounting, is a system of bookkeeping so named because every entry to an account requires a corresponding and opposite entry to a different account.

From Wikipedia

Another way to think of it is that everything is an account. You'll need to set up accounts for lots of things that aren't accounts at your bank to make the double-entry system work.
For example you'll need to set up various expense accounts like "office supplies" even though you'll never have a bank account by that name.

Generally an imbalanced transfer is when you have a from or to account specified, but not both. If I have imbalanced transactions I usually work them from the imbalance "account", and work each transaction to have its appropriate tying account, at which point it will no longer be listed under imbalance.

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If you are importing a year's worth of data, you have not given gnucash the chance to memorize your categories and then automatically do the categorization for you.

By importing all at once, you are then forced to set the category for every single transaction, even the redundant ones.

I would start over and do the following:

  • Import a small amount of data - less than a month

    In the import screen, click on each unique transaction and set an account for it (that is the category).

    Skip transactions that are duplicates of ones you already tagged with an account Do this for 50% of the transactions.

    Click CANCEL, and abandon your import

    The system will remember your categories. Immediately re-import that same data file

    You will see many many more transactions are now tagged with
    accounts.

    Do this again - manually tag more transactions - cancel - re-import When most are tagged, click OK to accept the import

    All the transaction that are NOT tagged with an account will go into the IMBALANCE account.

    Open the imbalance account.

    Sort it by Description

    Work your way down, assigning an account to a description.

    Double click on the account name you entered and copy it to the copy buffer

    Then for each Description that is the same, double click on the imbalance account to highlight it the paste the correct account name over the name 'imbalance' Do the next one with the same description.

    It will go fast.

As you do this process you will need to create new accounts which are in fact categories.

Most of the category accounts will be in the Expense or Income account types.

Then move on to the next month and slowing increase your time period for imports.

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