Accounting system

[penguineer]

We need an accounting system! A conversation with ChatGPT lead to this:

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Accounting Structure

Entities:

1. Ledger

   • Fields:
     • id (Primary Key)
     • fiscalYear
   • Relationships:
     • One-to-Many with Account

2. Account

   • Fields:
     • id (Primary Key)
     • accountName
     • accountType (Asset, Liability, Equity, Revenue, Expense)
   • Relationships:
     • Many-to-One with Ledger
     • One-to-Many with Transaction

3. Transaction

   • Fields:
     • id (Primary Key)
     • date
     • amount
     • description
   • Relationships:
     • Many-to-One with Account

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Account Types:

1. Asset Accounts:

   • Definition: Resources owned by the business expected to provide future economic benefits.
   • Examples: Cash, Accounts Receivable, Inventory, Fixed Assets, Prepaid Expenses.

2. Liability Accounts:

   • Definition: Obligations or debts the business owes to external parties.
   • Examples: Accounts Payable, Loans Payable, Salaries Payable, Unearned Revenue.

3. Equity Accounts:

   • Definition: Owner’s interest in the business (Assets - Liabilities).
   • Examples: Common Stock, Retained Earnings, Additional Paid-In Capital, Owner's Equity, Shareholders' Equity.

4. Revenue Accounts:

   • Definition: Income earned from normal operations.
   • Examples: Sales Revenue, Service Revenue, Interest Income.

5. Expense Accounts:

   • Definition: Costs incurred in the process of earning revenue.
   • Examples: Cost of Goods Sold, Salaries Expense, Rent Expense, Utilities Expense, Depreciation Expense, Advertising Expense.

[penguineer]

English Term	German Term
Ledger	Hauptbuch
Fiscal Year	Geschäftsjahr
Account	Konto
Account Name	Kontoname
Account Type	Kontoart
Transaction	Transaktion
Date	Datum
Amount	Betrag
Description	Beschreibung
Asset Accounts	Aktivkonten
Liability Accounts	Passivkonten
Equity Accounts	Eigenkapitalkonten
Revenue Accounts	Ertragskonten
Expense Accounts	Aufwandskonten

[penguineer]

Each TransactionDetail (or JournalEntry) can be linked directly to an Account and a Transaction. This way, each TransactionDetail represents the part of the transaction affecting a specific account, including the amount.

Here is the corrected entity structure:

Updated Entity Structure

Entities:

1. Ledger (Hauptbuch)

   • Fields:
     • id (Primary Key)
     • fiscalYear (Geschäftsjahr)
   • Relationships:
     • One-to-Many with Account (Konto)

2. Account (Konto)

   • Fields:
     • id (Primary Key)
     • accountName (Kontoname)
     • accountType (Kontoart: Asset, Liability, Equity, Revenue, Expense)
   • Relationships:
     • Many-to-One with Ledger (Hauptbuch)
     • One-to-Many with TransactionDetail (Buchungsdetail)

3. Transaction (Transaktion)

   • Fields:
     • id (Primary Key)
     • date (Datum)
     • description (Beschreibung)
   • Relationships:
     • One-to-Many with TransactionDetail (Buchungsdetail)

4. TransactionDetail (Buchungsdetail)

   • Fields:
     • id (Primary Key)
     • amount (Betrag)
   • Relationships:
     • Many-to-One with Account (Konto)
     • Many-to-One with Transaction (Transaktion)

Summary of Relationships:

• Ledger (Hauptbuch): One-to-Many with Account (Konto)
• Account (Konto):
  • Many-to-One with Ledger (Hauptbuch)
  • One-to-Many with TransactionDetail (Buchungsdetail)
• Transaction (Transaktion):
  • One-to-Many with TransactionDetail (Buchungsdetail)
• TransactionDetail (Buchungsdetail):
  • Many-to-One with Account (Konto)
  • Many-to-One with Transaction (Transaktion)

Updated Markdown Table with Headline Terms:

| English Term        | German Term          |
| ------------------- | -------------------- |
| Ledger              | Hauptbuch            |
| Fiscal Year         | Geschäftsjahr        |
| Account             | Konto                |
| Account Name        | Kontoname            |
| Account Type        | Kontoart             |
| Transaction         | Transaktion          |
| Date                | Datum                |
| Amount              | Betrag               |
| Description         | Beschreibung         |
| Transaction Detail  | Buchungsdetail       |
| Asset Accounts      | Aktivkonten          |
| Liability Accounts  | Passivkonten         |
| Equity Accounts     | Eigenkapitalkonten   |
| Revenue Accounts    | Ertragskonten        |
| Expense Accounts    | Aufwandskonten       |

This simpler structure ensures that each TransactionDetail captures the impact of a transaction on a single Account and that each transaction can be broken down into multiple TransactionDetails for comprehensive financial tracking.