RFC: Chapter 8 Tutorial/Guide (depreciation, cap gains)

[James Leone]

I have general comment about the term "asset appreciation."  Realizing 
that we have an international user base, I favor the use of an 
intenational accounting jargon.  However, I feel I should mention the 
jargon used in the U.S. should there be a chance that it is also used 
elsewhere rather than asset appreciation.

Although I have never heard the term used in the U.S. as a licensd 
professional (CPA), I do think that it is a logical description, moreso 
then the term Capital Gains.  But I don't generally expect to see the 
term asset appreciaiton anywhere.

I also have a general comment about when it is accounted for in the U.S.

In general, U.S. accountants do not revalue assets to fair market value. 
However, there is one exception, and that is securities for sale on the 
open market.

When stock with a readily determinable fair market value goes up in 
value, we call that unrealized appreciation. There is not much more that 
we account for here as far as Unrealized appreciation is concerned.

I hope that people from other countries will point out the differences, 
so we can get a snapshot on how to internationalize generic terms used 
in the guide.


James Leone


lapham at extracta.com.br wrote:

> Hello all-
>
> Okay, I've finished a first stab at chapter 8 of the tutorial and 
> guide.   Yeah, I know I've skipped a few chapters here, but my company 
> needs *this* info now... It is not ready for prime time yet, so no 
> patches, but I have HTML-ified what I've done so far and put it up on 
> my web site.  Please take a look and comments from financial 
> super-geniuses would be great.
>
> I would like to say that for most of the text I copied from the 
> gnucash v1.6 documentation (which I guess is the documentation cbrowne 
> wrote).
> http://www.gnucash.org/docs/C/gnucash-docs-1.6/
>
> Cruise over to:
> http://www.jandr.org/temp/gnucashdocs/
>
> =================================
> assetloan_concepts1.html
>
> This is the intro to the chapter.  My only question to the list for 
> this page is whether you think these 3 subjects belong in the same 
> chapter (asset depreciation, asset appreciation, and loans).  It seems 
> to me that loans are a different animal?  No?
>
> =================================
> asset_dep1.html
>
> This is the section on asset depreciation.  My questions for the list 
> here is in section "8.2.3 Handling Depreciation in GnuCash".  This is 
> directly copied from the 1.6 documentation, and it mentions that you 
> need 3 accounts: "Asset Cost", "Accumulated Depreciation", and a 
> "Depreciation Expense" account.  I do not understand what the 
> Accumulated Depreciation account does.  It does not appear in the 
> example.  Ideas?
>
> Also, if you have multiple assets you want to track, obviously you 
> need multiple "Asset Cost" accounts.  But, can they share the same 
> depreciation expenses account, or should they each have their own 
> depreciation expense accounts?
>
> Compare to:
> http://www.gnucash.org/docs/C/gnucash-docs-1.6/xacc-depr.html
>
> =================================
> asset_app1.html
>
> This is the section on asset appreciation.  My question is about the 
> example given at the end of "8.3.3. Capital Gains in GnuCash: Selling 
> the Asset".  It doesn't seem to match any of the 3 possibilities... or 
> am I just an idiot?
>
> Compare to:
> http://www.gnucash.org/docs/C/gnucash-docs-1.6/xacc-capitalgains.html
>

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