When you withdraw money from your bank account, for whatever reason, you are transferring money from your bank account to some other location. In GnuCash, this other location is tracked as an account. The more detailed accounts you create and use for your spending, the more information you will get about where your money goes.
Withdrawals take many forms. ATM withdrawals are one of the most common transactions. Writing checks is one way to withdraw money to pay bills, to buy purchases, or to give to charity. Depending on your bank, you might also have service charges, where the bank withdraws the money from your account. Transfers of money out to another account are also withdrawals. We will take a look at each of these types of withdrawals and how to record them in GnuCash.
Cash withdrawals are handled as a transfer from a bank account to a cash account. GnuCash provides special cash type accounts for tracking your cash purchases, so you should set up a cash account to record your ATM and other cash withdrawals.
Cash accounts can be used for different levels of detail. On a basic level of detail, you simply transfer money to it from your checking account. That tells you how much money you took out of checking on a given day, but it doesn't tell you where that cash was spent. With a little more effort, you can use the cash account to record your cash purchases as well, so that you can see where that cash went. You record these purchases as a transfer from the cash account to expense accounts.
Some people record every cash purchase, but this takes a lot of work. An easier way is to record the purchases for which you have receipts, but then adjust the balance of the account to match what is in your wallet.
It's a good idea to at least set up a cash account for your withdrawals. Then if you decide to track where your cash goes, you can enter transactions for the money you spend. You determine what level of detail you want to use.