Questions About Investment Accounts

[Mark Phillips]

Thanks for all the great input. I have one more question.....

How do I handle the Investment account sending money to my mom's checking
account?

What I have now, is
Assets:Checking = $200
Income:Investment Income=$200

I think I have to have something like this:

Assets:Investments:MCapital = -$200 (eg the money is coming from here)
Income:Investment Income = $200

but how do I get the money into her checking account?

Thanks,

Mark

On Fri, Apr 5, 2013 at 8:15 PM, John Ralls <jralls at ceridwen.us> wrote:

>
> On Apr 5, 2013, at 10:23 AM, Ian Konen <iankonen at gmail.com> wrote:
>
> > On Fri, Apr 5, 2013 at 12:22 PM, Derek Atkins <warlord at mit.edu> wrote:
> >
> >> Hi,
> >>
> >> Mark Phillips <mark at phillipsmarketing.biz> writes:
> >>
> >>
> >>>
> >>> How do I enter these values into gnucash? I don't think I should have
> an
> >>> expense account for Additions and Withdrawals or an Income account for
> >>> Income, as these transactions never leave this account. I am really
> just
> >>> interested in see the net change in this account on my balance sheet,
> and
> >>> not have the expenses and income go through my income statement. Would
> >> all
> >>> the offsetting entries be to some equity account? I think I am really
> >>> missing an important concept here.
> >>
> >> Yeah, if you want to see the change in value without recording the
> >> income or expense then you need to keep track of your shares and see the
> >> delta-V by changes in price.
> >>
> >>
> > Well now I'm confused.  I don't think I was wrong to say "the accounting
> > equation is a mathematical identity", but it does seem like that
> > contradicts your answer, at least in this example.  Isn't an increase in
> > share prices of a stock you own an income whether you realize the gain or
> > not?  I haven't used commodity / share prices in GnuCash myself and
> hadn't
> > though about the implications of changing values, but it seems like you
> > could unbalance your books if you don't record the value change as coming
> > from an income account.
>
> You're right and so is Derek.
>
> The key is that  "current value" and "book value" are different. Book
> value (also called "basis") is what you paid when
> you bought the security. Current value is what you would have gotten had
> you sold the security at the price of its most
> recent trade. The difference between the two is the "unrealized gain or
> loss".
>
> If you maintain a separate account for each security and maintain the
> price database with its current price then Gnucash
> will report the current value on the Accounts page and in the portfolio
> reports. That's separate from the book value, which
> is what's reflected in the register and on the business reports.
>
> So, for the OP, here's how to fake it: Create a bogus security to
> represent all of the securities in your brokerage account.
> You can manually insert fake prices for the bogus security in the Price
> Editor, and the Accounts page will show the
> changing current value of your account as you want. It's utterly useless
> for anything else, and arguably more work than
> actually creating the securities sub-accounts and letting F::Q retrieve
> the prices for you, but that's a way to do what
> you're asking for.
>
> Just don't show it to your accountant or tell anyone I had anything to do
> with it. ;-)
>
> Regards,
> John Ralls
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