simple howto for selling stocks

[Charles Day]

On Sat, May 10, 2008 at 11:41 AM, corkscrew60 <cem22b at gmail.com> wrote:

>
> I am a new user to gnucash i have swapped over from quicken.


Congratulations. If you converted your Quicken data using the QIF importer,
I hope that you used GnuCash version 2.2.5. Many improvements and fixes were
recently made with regard to importing investments.


> On the whole i
> like it better except for selling stock. I just cant get my head round the
> instructions given in the help file. Does anyone know of a simple howto
> giving a step by step on how to do this.


The instructions in the help file will seem strange compared to what you do
in Quicken. In Quicken the recording of a "sell" is more automated. The
capital gains are calculated more or less automatically, then hidden from
you until you run a report showing your income.

GnuCash isn't quite ready to calculate and record the capital gains
automatically as shown in the manual. And if it did, they wouldn't be
hidden. Instead, capital gains are recorded using a capital gains income
account.

Please see section 8.7.1 of the concepts guide here:
http://svn.gnucash.org/docs/guide/invest-sell1.html

I have an investment account set up with a number of funds within it. I have
> sold a complete subset and bought another all under the same investment
> account. The instructions in the help file mentioning setting up a capital
> gains account I dont see why i need this when the money from the sale satys
> within the investment account to make the new purchase of the different
> funds


Because the proceeds from sale of shares involves two parts:
1. The amount you paid for them (your "basis"), which is NOT income.
2. The rest (your "capital gain"), which IS income.

Part 1 is just a transfer between the two asset accounts: your investment
account and the account holding the shares.
Part 2 requires use of an income account. Otherwise your books will become
out of balance because new money would appear but not new income.

Hopefully the sales process will become automated soon. There has recently
been some discussion about that, and some code needed to implement this
already exists. Someone just needs to contribute the rest.

Cheers,
Charles