Hello all,
quick question: If I were to lend money to some Friend A for a couple of years, would I register that under assets or equity?
I ask because most advice I see so far consider this to be "Receivable" which is supposed to be an asset because "it'll be converted into actual money in the near future". But this is not the case when it is long term. I also do not really "own" this money at that point in time, do I?
Would it make more sense to register such a thing as a negative liability or put it in equity? (if not the latter, is there ever a use case for equity aside from the opening balance?
Thanks!
[link] [comments]
This is a companion discussion topic for the original entry at https://www.reddit.com/r/plaintextaccounting/comments/1b6q8cz/longterm_money_lending/