On 6 Nov 96 11:23pm, CAROLE CAPUANO wrote to BRUCE WILSON:
 BW> Your view is too narrow.  Debit balance = asset.  Credit balance =
 BW> liability.  I set aside funds withheld from our employees' pay in
 BW> liability accounts.  If one of them goes debit balance, it means
 BW> we've paid out more than we've withheld and someone owes us money.
 BW> (I.e., the liability's become an asset.)
 CC> In this case it is never an asset, you don't own fiduciary funds.
Again, your view's too narrow.  What you owe is a liability and what
others owe you is an asset, regardless of how it may be captioned.
A credit balance bank account's become a liability -- money owed to
the bank rather than money owed by the bank -- even if it's nominally
an asset account.
The better way of presenting the withholding situation would be to
debit an employee receivable and credit the withholding to bring the
withholding account to zero or a credit balance, but the net effect
on the balance sheet of doing that will be zero.
--- Via Silver Xpress V4.3dP [Reg]
---------------