Spreading a expense over multiple months

Aug 17, 2007 2 Replies

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Dave 18 years ago

Hello:

There are a number of bills that I choose to pay annually / semi- annually for expenses in advance. For example, I pay my daughter's tutuion in full at the beginning of the school year, even though I could make monthly paments.

Unfortunately, this does not work well with Quickens idea of budgeting

-- a single payment for a yearly expense makes a single monthly chart appear all out of whack. Ideally, the expense should show up as 1/12 in each monthly period (or 1/6 if semi monthly).

I guess I could create a special account (Pre paid expenses?) in which credit the payment, and then enter the monthly offsetting payments debiting the category in each monthly period. But what a pain.

Any other suggestions? I just don't see any way to do this is a single transaction.

Thanks,

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Laura 18 years ago

Creating a Prepaid expense account on the balance sheet is exactly how it should be handled if you were using a real accounting software program and if you are an accrual basis company/tax payer. But since most taxpayers are a cash basis Quicken records everything when paid, i.e. on a cash basis.

Your method will work but just make sure that you "expense" the entire payment by year end if the item is tax deductible.

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Dave 18 years ago

Laura:

thanks.

Too bad quicken doesn't allow splits across dates similar to the way they allow you to split categories. But its really annoying to see these misleading spikes in the months (which all group together) when I pre-pay a few major expenses.

\ Thanks again.

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