In-kind account type for non-profit transaction and budgets.
07/03/09 11:52am PDT, Viewed by asker 08/06/09 11:17am PDT
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I am setting up a new chart of accounts for a non-profit. They have budgeted amounts for In-Kind. How do you suggest I set up these accounts? What type should they be? I will need to enter budgeteed amounts. I originally thought I should set up In-Kind as a subclass to the General Fund. I think that this is a good idea. Just wondering about the type of account (other asset?) because I believe that they will want to enter transactions to the accounts if they are budgeting them. This poses another question, how would I enter trancactions to these accounts?
Solved!
Solved!
Hi Alaskagirl.
You can do this one of two ways.
1. Set up an Income account (in-kind donations) and an expense account (in-kind ). Your entries will be with a journal entry, with the debit and the credit amounts being the same. Example: legal services received to incorporate your business (estimated value $5000). You would debit In-kind expenses(you can create sub-accounts under in-kind) for $5000 and credit in-kind donations for the same amount.
2. You can isolate the in-kind by setting up the accounts as : Other Income and Other Expenses. They will appear at the bottom of your profit and loss. You would then not have to create a separate class for the in-kind since it will be isolated from your operating revenue and expenses, but the information will be there for comparative purposes.
You should have no problems entering in the budget line items if you do it this way.
