This repository contains the Python program BillSplitterForTwo which, once run, prompts to the user to:

• create a new file;
• add a transaction (to an existing file);
• show account balances;
• quit.

The program creates or updates an .xlsx file in the same folder containing the program itself.

pip install pandas xlsxwriter
python BillSplitterforTwo.py

This program is tailored to accounting for two people. Not three or higher. The .xlsx file created contains two sheets, one for each person. On each person's sheet the following fields are created:

• description;
• total amount;
• taxes;
• additional costs;
• person's amount;
• amount paid by person;
• what they are owed/owed;
• external debts.

Upon creating a file, the above fields are initialised. When adding a transaction, the user is prompted to fill in each field.

The program itself passes no values and relies on user inputs.

As mentioned, this system is tailored to record-keeping for two people, say person $A$ and person $B$. In a given transaction there are a few parameters to account for: the amounts actually paid by each person $A$ and $B$, say $x_A$ and $x_B$ respectively. The amounts in the transaction that each person actually owes, say $y_A$ and $y_B$. And finally the total value of the transaction itself, say $t$.

By construction $t = y_A + y_B$. The value of the transaction is made up of what each person in the transaction actually owes. This must be reconciled with what each person actually paid.

There are three scenarios to now consider: where the totals paid equals the total, is overpaid or underpaid. That is:

• $x_A + x_B = t$;
• $x_A + x_B > t$;
• $x_A + x_B < t$.

Recall, it is always the case that $y_A + y_B = t$. With $x_A + x_B = t$ also, what matters is the relative differences $x_A - y_A$ and $x_B - y_B$. If these differences are zero, then person $A$ and $B$ paid what they owe and there is no issue. No one owes the other. In the case where, say, $x_A - y_A > 0$, this means $A$ paid what they owe and part of person $B$ owes. Hence that $B$ underpaid, The accounting system records $x_A - y_A$ in $A$'s column owed/owes. In $B$'s column, the system records $x_B - y_B$. This is the amount $B$ owes $A$.

Note. In this case $x_A - y_A = -(x_B - y_B)$, so the debts recorded as above are indeed balanced. To see why this equality holds, note that upon rearranging we find $x_A + x_B = y_A + y_B = t$, which is what we assumed at the outset.

In this case $x_A + x_B > t$, so each person has in combination overpaid what they owe. They are therefore entitled to change $c = (x_A + x_B) - t$. In the accounting system this change is redistributed back to each person in proportion to what they paid. That is, person $A$ receives change $c_A = \frac{x_A}{x_A + x_B}c$ and person $B$ receives $c_B = \frac{x_B}{x_A + x_B}c$.

Upon redistribution, each person's effective pay is: $\tilde x_A = x_A - c_A$ and $\tilde x_B = x_B - c_B$. Note that now $\tilde x_A + \tilde x_B = t$ and we are in the situation above where the combined payment is equal to the total owed, $t$. The system above can then be used to record this transaction and any debt owed.

This scenario is more difficult to account for since, in this case, $x_A + x_B < t$ entailing a new debt obligation. On each person's sheet in the spreadsheet one finds a record in the external debts column.

Now if both persons underpay, $x_A < y_A$ and $x_B < y_B$. Hence each owes the external debtor an amount $|x_A - y_A|$ and $|x_B - y_B|$ respectively. The accounting system records the raw value $x_A - y_A$ and $x_B - y_B$ in the external debts column on the respective spreadsheets.

In the case where one of the persons pay what they owe while the other fails, e.g., $x_A = y_A$ but $x_B < y_B$, then there is a debt obligation $x_B - y_B$. This is born entirely by person $B$. Accordingly person $A$ does not record any external debt and $B$ records an external debt of $x_B - y_B$. Note that $B$ does not owe $A$ anything.

Finally, we have the subtle case where one overpays and the other underpays to the point of total underpayment. So e.g., $x_A > y_A$ and $x_B < y_B$ and $x_A + x_B < t$. In this case $A$ has paid what they owe and some of what $B$ owes; $B$ now owes both an external debt and a debt to $A$. The external debt which $B$ owes is what remains on the bill, $(x_A + x_B) - t$.

The debt owed by $B$ to $A$ is $x_A - y_A$, the excess which $A$ paid over what they owed.

Note. Recording the debt owed by $B$ in this way is indeed consistent. That is, the total debt owed by $B$ is what they paid less what they owe, i.e., $x_B - y_B$. That is each of $B$'s debts, $(x_A + x_B) - t$ and $-(x_A - y_A)$, will sum to precisely what remains on what $B$ owes. That is $((x_A + x_B) - t) + (-(x_A - y_A)) = x_B - y_B$.

Suppose Alice and Balkrishna split a taxi fare. The taxi costs $500$ in whatever currency. As they are splitting the fare, each owes $250$. Accordingly $y_A = 250$ and $y_B = 250$. When they pay suppose that:

• Alice pays $350$; Balkrishna pays $150$.

Then $x_A = 350$ and $x_B = 150$. Note that $x_A + x_B = 500$ so there is no change or external debt. The accounting system will record $x_A - y_A = 350 - 250 = 100$ in Alice's owed/owes column. It will likewise record $x_B - y_B = 150 - 250 = -100$ in Balkrishna's owed/owes column.

Balkrishna owes Alice $100$.

Alice and Balkrishna took that taxi to a restaurant for dinner. Alice had the sirloin pork cutlet and Balkrishna a full spit roast. Suppose the dinner for both cost 1500. Of this:

• Alice paid $600$ while Balkrishna pids $1200$.

Then $x_A + x_B = 600 + 1200 = 1800$. This exceeds the amount owed for dinner, being $1500$, resulting in change $1800 - 1500 = 300$. Of the total amount paid, $1800$, Alice paid $1/3$; Balkrishna $2/3$. Hence Alice gets back $(1/3)(300) = 100$ in change; Balkrishna $(2/3)(300) = 200$ in change. Their respective effective payments are $\tilde x_A = 600 - 100 = 500$ and $\tilde x_B = 1200 - 200 = 1000$. Note $\tilde x_A + \tilde x_B = 1500$.

Suppose now that the cost of Alice's dish is $y_A = 700$; and Balkrishna's is $y_B = 800$. The accounting system will record $x_A - y_A = 500 - 700 = -200$ in Alice's owed/owes column; and in Balkrishna's owed/owes column $x_B - y_B = 1000 - 800 = 200$.

Combined with the taxi fare, Alice's owed/owes column is $100 + (-200) = -100$ and Balkrishna's owed/owes column is $-100 + 200 = 100$. Hence Alice now owes Balkrishna an amount of $100$.

Alice and Balkrishna are running out of cash. On the taxi ride back from the restaurant to wherever they came from, suppose the fare is $500$ and:

• Alice pays $x_A = 350$; Balkrishna pays $x_B = 100$.

The total amount paid is $x_A + x_B = 350 + 100 = 450$, which is $50$ short of what is owed. This thereby creates an external debt obligation. Am amount of $50$ needs to be paid to the taxi driver.

Alice owed $y_A = 250$ and Balkrishna $y_B = 250$. Since $x_A = 350 > 250$, Alice does not record an external debt. Balkrishna however does record such a debt, in an amount of $(x_A + x_B) - t = (350 + 100) - 500 = -50$. Moreover, since Alice overpaid what was owed, $x_A - y_A = 350 - 250 = 100$, Alice's owed/owes column records $+100$. On Balkrishna's records, an amount $x_B - y_B + c = 100 - 250 + 50 = -100$ is recorded. This transaction brings Balkrishna back into debt toward Alice.

Now in combination with the other two transactions, see that Alice's owed/owes column is $-100 + (+ 100) = 0$ and Balkrishna's column is $100 + (-100) = 0$. Hence Alice and Balkrishna are in fact all settled up. It remains for Balkrishna to pay the taxi driver $50$, as recorded in Balkrishna's external debts column.

Remark. Record the above three transactions as an exercise in using the program BillSplitterForTwo.