r17481 - gnucash-docs/trunk/guide/C - Bug #334255: Update the "Purchasing foreign stocks" section of the Tutorial and Concepts Guide

Andreas Köhler andi5 at cvs.gnucash.org
Sat Aug 30 10:57:27 EDT 2008


Author: andi5
Date: 2008-08-30 10:57:27 -0400 (Sat, 30 Aug 2008)
New Revision: 17481
Trac: http://svn.gnucash.org/trac/changeset/17481

Modified:
   gnucash-docs/trunk/guide/C/ch_currency.xml
Log:
Bug #334255: Update the "Purchasing foreign stocks" section of the Tutorial and Concepts Guide

to warn about using the stock register to enter purchases
in foreign currency. Also some other revisions to the same section to
update, clarify, or fix spelling/grammar.

Patch from Charles Day.


Modified: gnucash-docs/trunk/guide/C/ch_currency.xml
===================================================================
--- gnucash-docs/trunk/guide/C/ch_currency.xml	2008-08-29 12:00:03 UTC (rev 17480)
+++ gnucash-docs/trunk/guide/C/ch_currency.xml	2008-08-30 14:57:27 UTC (rev 17481)
@@ -521,26 +521,21 @@
     <sect2 id="currency_purchase3">
       <title>Purchasing foreign stocks</title>
 
-      <para>A more complicated example</para>
-
-      <para>This example will show how to deal with having stocks in a
+      <para>This example will show how to purchase stocks that are priced in a
       different currency than your normal currency.</para>
 
-      <para>In this example you live in America and therefore you have set the
-      default Currency to USD. You decide to purchase some stocks in Hong Kong.
-      </para>
+      <para>Assume that you live in New York and therefore you have set the
+      default currency to USD. You decide to purchase a stock traded in Hong
+      Kong that is priced in HKD. You would also like to be able to track the
+      various income and expenses per stock and broker.</para>
 
-      <para>You would also like to be able to track the various income and
-      expenses per stock and broker.</para>
+      <para>You decide to purchase stock in the Beijing Airport (Hong Kong).
+      (After all, the 2008 Olympics in Beijing have finished and the price has
+      returned to Earth.)</para>
 
-      <para>The stock you want to purchase are Beijing Airport (Hong Kong)
-      (Afterall the 2008 Olympics in Beijing should bring in a lot of business
-      to the airport)</para>
-
       <note><para>
-         The above stock (Beijing Airport) are just choosen
-         for this particular example, and should not be taken as any kind of 
-         stock purchase advice 
+         The above stock (Beijing Airport) has been chosen only as an example,
+         and should not be taken as any kind of stock purchase advice.
       </para></note>
 
       <para>You need to find out what the stock ticker is for this 
@@ -558,7 +553,7 @@
       </itemizedlist>
       
       <para>Since we wanted to be able to track all various incomes and expenses,
-      we come up with the following Account structure</para>
+      we come up with the following Account structure:</para>
 
       <literallayout>
 Assets:Investments:Brokerage Accounts:Boom:0694.HK     (Beijing Airport)
@@ -569,7 +564,7 @@
       </literallayout>
       
       <para>The Chart of Accounts looks like this after creating all the
-      needed accounts</para>
+      needed accounts:</para>
 
       <screenshot id="currency_purchase_BeforeStocks.png">
         <mediaobject>
@@ -587,8 +582,9 @@
         </mediaobject>
       </screenshot>
 
-      <para>The various commodities (<guimenu>Tools</guimenu> -&gt; 
-      <guimenu>Security Editor</guimenu>) looks like this</para>
+      <para>The stock definition can be seen in the Security Editor.
+      (<guimenu>Tools</guimenu> -&gt; <guimenu>Security Editor</guimenu>)
+      </para>
 
       <screenshot id="currency_purchase_Commodities.png">
         <mediaobject>
@@ -598,41 +594,33 @@
           </imageobject>
 
           <textobject>
-            <phrase>International commodities</phrase>
+            <phrase>International securities</phrase>
           </textobject>
 
-          <caption><para>International commodities</para></caption>
+          <caption><para>International securities</para></caption>
         </mediaobject>
       </screenshot>
 
-      <note><para>
-         There is currently a small bug ( 
+      <para>If you have not moved some money (HKD 50,000) into the brokerage's
+      cash account (Assets:Investments:Brokerage Account:Boom:Bank), do so
+      now, either using the Equity (HKD) account, or an existing bank account
+      (Currency Transfer).</para>
 
-        <ulink 
-          url="http://bugzilla.gnome.org/show_bug.cgi?id=335101"><citetitle>335101</citetitle>
-        </ulink>
-
-         ) in GnuCash, that makes it impossible to buy a stock in a different currency than the default directly from the commodity account. The simple workaround is to open the associated bank account and enter the transaction from here. 
-      </para></note>
-
-      <para>If you have not moved some cash (HKD50,000) to the corresponding stocks bank
-      account, do so now. Either using the Equity (HKD) account, or by transfering
-      money from an existing bank account (Currency Transfer).</para>
-
-      <para>To record this stock purchase, you have to open the stocks associated
-      bank account (Assets:Investments:Brokerage Account:Boom:Bank), and there enter
-      the following information</para>
+      <para>Let's assume that stock price is HKD 3 per share. To record the
+      purchase, open the brokerage's HKD cash account
+      (Assets:Investments:Brokerage Account:Boom:Bank), and enter
+      the following:</para>
 <literallayout>
-Buy Stocks 
+Buy Stocks
 	Assets:Investments:Brokerage Account:Boom:Bank  Withdrawal 50,000
 	Expenses:Investments:Commission:Boom_HKD	Deposit 500
 	Assets:Investments:Brokerage Account:Boom:0694  Deposit 49,500 (16,500 shares)
-    </literallayout>
+</literallayout>
 
-      <para>If the "Exchange Data" dialog popup do not appear, open it
-      manually by right click on the last row, and select <guilabel>Edit
-      Exchange Rate</guilabel> In the following pop up window, enter the
-      actual number of stocks (16,500) as the <guilabel>To Amount:</guilabel> 
+      <para>If the exchange rate dialog box does not appear automatically,
+      right-click on the stock row, and select <guilabel>Edit
+      Exchange Rate</guilabel>. Enter the number of shares (16,500) as the
+      <guilabel>To Amount</guilabel>.
       </para>
       
       <screenshot id="currency_purchase_ToAmount.png">
@@ -646,15 +634,12 @@
             <phrase>Transfer Funds</phrase>
           </textobject>
 
-          <caption><para>Setting To Amount in the Transfer Funds dialog</para></caption>
+          <caption><para>Setting the number of shares in the Transfer Funds dialog</para></caption>
         </mediaobject>
       </screenshot>
 
-      <para>When you exit the exchange dialog, and Enter this transaction GnuCash will 
-      update the stock purchase transaction with all relevant data.</para>
-    
-      <para>If you now go back to the main Chart of Accounts, you will see something like
-      this</para>
+      <para>If you return to the Chart of Accounts, you will see the
+      purchased shares reflected in the stock account's total.</para>
       
       <screenshot id="currency_purchase_AfterStocks.png">
         <mediaobject>
@@ -672,12 +657,26 @@
         </mediaobject>
       </screenshot>
 
-      <para>As you can see, everything is in its own Currency, and this is because GnuCash
-      do not have any exchange rates between USD and HKD. To remedy this go to
+      <para>However, as you can see, the USD totals may be zero if
+      GnuCash doesn't have an exchange rate between USD and HKD.
+      To fix this, go to
       <guimenu>Tools</guimenu> -&gt; <guimenu>Price Editor</guimenu>
-      and click on the <guibutton>Get Quotes</guibutton> button to
-      automatically load the various exchange rates you need.</para>
+      and click the <guibutton>Get Quotes</guibutton> button to
+      automatically retrieve the exchange rates you need.</para>
 
+      <note>
+        <para>This example shows how stock can be purchased in any currency
+         by entering the transaction in the register of the cash account used
+         to make payment. It is also possible to enter the purchase
+         in the stock account's register, but proceed with caution!
+         When doing it that way, the stock is assumed to be priced
+         in the currency of the stock account's parent.</para>
+        <para>In this example, the stock account's parent
+         (Assets:Investments:Brokerage Account:Boom) is denominated in HKD.
+         Since this is same currency as the stock price, the purchase
+         can be safely entered in the stock account's register.</para>
+      </note>
+
     </sect2>
     
   </sect1>



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