Handling a Stock Spin Off

[David T.]

I am trying to get my brain around the transactions and splits needed to track a stock spin off. Back in January of 2008 (how ever did I miss it for so long!), DISH spun off SATS 5 to 1 (that is, for every share of DISH, I received .2 shares of SATS). According to one site I found, these are the data points I need to consider:

1. Spinoff date - 1/1/2008
2. Parent company - EchoStar Communications Corporation [DISH]
3. Remaining basis percentage of Parent Company, [DISH] - 82.5610.
4. Number of shares held in parent company - 200.
5. Daughter company - EchoStar Holding Corporation [SATS]
6. Number of shares of SATS received - 40.
7. Price per share of daughter company - $35.

I am not entirely sure how I should be tracking this in GnuCash. A MoneyDance forum gives the following (MoneyDance-centric) set of instructions:

1, Leave the original purchase entry alone
2, Do a SellXfr of the original shares at $0 dollar amount (I created a special category "Stock Spinoff" to account for the double-entry required)
3, Do a BuyXfr to record acquiring the new parent shares at the published adjust cost basis (as per company press release) of the original share price on the spin-off date
4, Do a BuyXfr to record acquiring the new child shares at the published adjust cost basis (as per company press release) of the original share price on the spin-off date

What I *think* all this means is:
Sell 200 DISH @ $0 to Equity:Asset Cost
Buy 200 DISH @ .82561 * 2.09635 [my orig purch price] from Equity:Asset Cost
Buy 40 SATS @ $35 from Equity:Asset Cost

FYI: Equity:Asset Cost is the account that the shares came from originally.

Is this correct?

Thanks,
David