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diff --git a/doc/en/makemostof.docbook b/doc/en/makemostof.docbook new file mode 100644 index 0000000..fb4e0df --- /dev/null +++ b/doc/en/makemostof.docbook @@ -0,0 +1,361 @@ +<?xml version="1.0" encoding="UTF-8"?> +<chapter id="makingmostof"> +<chapterinfo> + <authorgroup> + <author> + <firstname>Joe</firstname> + <surname>(joe1011010)</surname> + <affiliation> + <address><email>joe1011010_km@users.sourceforge.net</email></address> + </affiliation> + </author> + </authorgroup> + <date>2009-05-05</date> + <releaseinfo>1.0</releaseinfo> +</chapterinfo> + +<title>Making the most of &kappname;</title> + +<para> + Whilst you could go ahead, clicking some buttons and filling in some data, + after a time, you could decide you have done it wrong and start again, even if + you did read the documentation on each part of &kappname;. +</para> + +<para> + You will get a more effective system if you spend a little time planning how + you are going to use &kappname;, so follow the steps given here. +</para> + +<sect1 id="makingmostof.basicaccounting"> +<title>Basic Accounting</title> + +<para> + Imagine your money as balls, or beans, and to stop them rolling around you + keep them in a box, or pot. Accounting, or Book Keeping, is the process of + counting the beans in the pot, or several pots. +</para> + +<para> + You have some money in the pot marked <quote>Cash</quote>. You buy some goods, + so you take some beans out of the cash pot and place them into another pot + marked <quote>Supplier</quote>. The supplier gives you some goods in exchange + for the cash, so you take the beans out of the pot marked + <quote>Supplier</quote> and put them in the pot marked <quote>Goods</quote>. +</para> +<para> + The goods have a value (the price you paid) so you still have the same amount + of beans, some representing cash and some representing goods. +</para> +<para> + In this case you have two movements of beans, or transactions. Each + transaction needs two entries, one to take beans out and one to put beans + in. This is called <quote>double entry book keeping</quote> or <quote>double + entry accounting</quote>. The recording of the transactions is done in a + <quote>Ledger</quote>; each pot is known as an <quote>Account</quote> or + <quote>Ledger code</quote>. +</para> + +<para> + Now you take some goods and give them to a customer, who gives you some cash + in exchange. The goods were worth some beans and, hopefully, the customer has + given us more beans than that, so making a profit. To over simplify, the beans + from the Goods pot come back as Cash, but we can split that as the <quote>Cost + of Goods sold</quote> and <quote>Profit</quote>. This transaction has three + entries; one side of the <quote>double entry</quote> has been split. +</para> + +<para> + This will be covered properly in setting up accounts for Businesses. +</para> + +<sect2 id="makingmostof.basicaccounting.personalaccounts"> +<title>Defining the accounts (personal records)</title> + +<para> + Most accounts, or pots, above represent a measure of our + <quote>Worth</quote>. The cash and goods represent our <quote>Assets</quote>; + so does what we are owed if our customers have not yet given us the money. The + money we owe, say if we had not paid our suppliers, are our + <quote>Liabilities</quote>. These accounts are transferable to Cash and have a + value. +</para> + +<para> + Any pots that cannot be valued are <quote>Income</quote> or + <quote>Expense</quote>, such as an unpaid phone bill that would be an expense + as we have already made the calls. Although these do not have a value, it is + useful to monitor how much is in each. +</para> + +<para> + In some cases a supplier is a <quote>Liability</quote>, in others it is an + <quote>Expense</quote>. This is something we need to consider and decide for + each case. Similarly, you may set up a loan as a Liability, particularly if + you transfer the money into your bank account, but it could be an Expense if + it was to buy some furniture. +</para> + +<para> + Consider how you want to analyze your income and expenses. This will decide how you set them up. +</para> + +<para> + Finally, consider if you want everything in one set of accounts, or two or + more. This may depend on the legal framework or just how you want to analyze + things. Each set of accounts would be handled separately. +</para> +</sect2> + +<sect2 id="makingmostof.basicaccounting.businessaccounts"> +<title>Defining the accounts (business records)</title> + +<para> + This is similar to setting up for personal use, but needs to follow legal + guidelines. We do not discuss them here, but you should be aware of what these + are. +</para> +</sect2> +</sect1> + +<sect1 id="makingmostof.mapping"> +<title>Mapping your finances to &kappname;</title> + +<para> + So, collect up your papers and see the following sections for each item in + &kappname;. +</para> + +<sect2 id="makingmostof.mapping.accounts"> +<title>Accounts</title> + +<para> + These hold a value. Transactions are created against one or more accounts. +</para> + +<sect3 id="makingmostof.mapping.accounts.asset"> +<title>Accounts - Asset</title> + +<para> + These are the accounts which hold your money and possessions that you wish to + monitor. The following types are available: +</para> + +<variablelist> + <varlistentry> + <term>Checking</term> + <listitem> + <para> + Standard bank checking account. + </para> + </listitem> + </varlistentry> + + <varlistentry> + <term>Savings</term> + <listitem> + <para> + Standard bank savings account. + </para> + </listitem> + </varlistentry> + + <varlistentry> + <term>Cash</term> + <listitem> + <para> + Money in your hand or wallet. + </para> + </listitem> + </varlistentry> + + <varlistentry> + <term>Loan</term> + <listitem> + <para> + Loans you make to someone else. + </para> + </listitem> + </varlistentry> + + <varlistentry> + <term>Investment</term> + <listitem> + <para> + Money you invest. + </para> + </listitem> + </varlistentry> + + <varlistentry> + <term>Asset</term> + <listitem> + <para> + Property, collections, etc. + </para> + </listitem> + </varlistentry> +</variablelist> +</sect3> + +<sect3 id="makingmostof.mapping.accounts.liability"> +<title>Accounts - Liability</title> + +<para> + These are the accounts which represent your debts and money owed that you wish + to monitor. The following types are available: +</para> + +<variablelist> + <varlistentry> + <term>Credit card</term> + <listitem> + <para> + Standard credit card account. + </para> + </listitem> + </varlistentry> + + <varlistentry> + <term>Loan</term> + <listitem> + <para> + Loans made to you, mortgages, etc. + </para> + </listitem> + </varlistentry> + + <varlistentry> + <term>Liability</term> + <listitem> + <para> + Anything else you owe that is not a loan. + </para> + </listitem> + </varlistentry> +</variablelist> +</sect3> +</sect2> + +<sect2 id="makingmostof.mapping.institutions"> +<title>Institutions</title> + +<para> + These are completely optional and can be used to group accounts, and show a + total value for all accounts in each group. +</para> +</sect2> + +<sect2 id="makingmostof.mapping.categories"> +<title>Categories</title> + +<para> + These represent non-managed income and expense accounts that do not have a + value. The total value of transactions is shown against each category. A + category or transfer account is required for each transaction. +</para> +</sect2> + +<sect2 id="makingmostof.mapping.subcategories"> +<title>Sub-Categories</title> + +<para> + Categories can be split into sub-categories, but the sub-category totals are + not included in the higher level category total. +</para> +</sect2> + +<sect2 id="makingmostof.mapping.payees"> +<title>Payees</title> + +<para> + These are optional for transactions. They are required for Scheduled + transactions. A transaction history, with category, is shown against each + payee. +</para> +</sect2> + +<sect2 id="makingmostof.mapping.schedules"> +<title>Scheduled transactions</title> + +<para> + Where regular transactions occur, these can be set up against a + Schedule. Transactions are created from a schedule; any that are overdue can + be seen on the home page. +</para> +</sect2> +</sect1> + +<sect1 id="makingmostof.usefultips"> +<title>Useful Tips</title> + +<para> + Unless you keep you money under the floorboards, you probably make use of one + or more institutions where you have accounts which may be in credit or + debit. In order to familiarise yourself with the way &kappname; works, choose + an account you want to track of with &kappname; and select File>New in order + to set up an account file. +</para> + +<para> + If you have used another personal finance manager, you may be able to import + the data from it into &kappname;. +</para> + +<para> + If you have some regular receipts into or outgoings from this account, go to + Payee and enter the names of both the payers and the payees involved; then go + to Schedule and fill in a New Schedule for each transaction. If you haven't + entered the payee or payer, &kappname; will offer you the opportunity to do + this in the middle of entering the schedule. +</para> + +<para> + To add other new transactions go to Ledgers; you can add new payees and + categories in the middle of a transaction or by going to Payees or Categories + before entering the transaction. +</para> + +<para> + You will probably find that the default Categories do not exactly match your + needs; you can easily delete ones you know you are never going to need and add + others that you need. But when you are entering a transaction, you only have + to type a few letters of a category and &kappname; will offer you a drop down + list of the matching categories from which to choose. +</para> + +<para> + You can add different accounts managed by different institutions; the + preferred one will show when you open &kappname; but you can quickly switch to + any of the others. +</para> + +<para> + When you make a payment, &kappname; will work out what the next cheque number + should be; delete this if you are not making a cheque payment or edit it if + the first cheque you enter is not cheque number 1. Alternatively, it is + possible to switch off auto-increment of cheque numbers. +</para> + +<para> + Every so often you may get statements of your account from the institutions + you use; you can reconcile your &kappname; accounts against these statements + so that you have an accurate statement of the current state of your finances. +</para> + +<para> + If you go to Reports, you will find several default reports; to customise + these, open one similar to the sort you perfer and then select 'New' (not + 'Copy'); you can then customise this to your needs and mark it as a preferred + report if you wish. +</para> + +<para> + Though &kappname; is not intended for use in a business context, if you are + running a business on your own and so do not need payroll functions, you will + probably find that &kappname; is sufficiently customisable to meet your needs + particularly as it comes with budgeting and forecasting features and you can + export your customised reports via CSV into other applications. +</para> +</sect1> +</chapter> |