Investment income (was Re: Questions About Investment Accounts)

[David Carlson]

On 4/7/2013 11:10 PM, Ian Konen wrote:
> On Sun, Apr 7, 2013 at 12:04 PM, David Carlson
> <david.carlson.417 at gmail.com>wrote:
>
>> On 4/6/2013 5:55 PM, John Ralls wrote:
>>> On Apr 6, 2013, at 11:22 AM, Ian Konen <iankonen at gmail.com> wrote:
>>>>
>>>> So out of curiosity I created a security for a fake company, and
>> purchased 100 shares at $10 / share (with a balancing transaction from a
>> cash account).  Then I put some manual entries in the price editor so that
>> it was later valued $15/share.  Generating a balance sheet at that point in
>> time has a line called "Unealized Gains" worth $500, as well as a line for
>> the security with shares and total current value (after I set the commodity
>> option to use "nearest price").  So far so good. But then if I sell those
>> stocks at $20 / share and enter a $2000 transfer back to the cash account,
>> the balance sheet at a later time still labels that $1000 profit as
>> "unrealized gains" even though it has quite clearly been realized at that
>> point, and the calculation is (correctly IMO) using the share price of the
>> sale transaction instead of the value from the price editor ($15/share) at
>> the time.  If I generate a profit and loss statement covering that entire
>> period, it shows 0 income/profi!
>>  t!
>>>   whatsoever even though there was a real $1000 profit.
>>>> It's those last two points that seem wrong to me.  I guess I had
>> assumed that GnuCash would automagically create a realized gains income
>> account and fill it to reflect stock price changes at sale, but perhaps
>> that's too complicated to code.
>> Ian,
>> In that test file run a trial balance, being sure to include the dates
>> of the security transactions.  You will probably find that it is out of
>> balance because you did not include the lines in the closing
>> transaction(s) to reduce the cost basis to zero and apply the "realized"
>> gain to an income account.  If you do that, the report should not show
>> any unrealized gains.
>>
>> David C
>>
>>
> Ahhh...yes, you are correct I had not entered the sale correctly.  Despite
> having just recommended reading about stocks in the tutorial to Mark, I had
> not yet read the "selling shares" section of the tutorial myself ;-).  The
> transaction still looks funny to me when done correctly, but I think I
> understand why it's needed.
>
> It does bring up another behavior that probably should be considered a bug:
>  Having two splits for an account in the same transaction causes the
> transaction to be displayed twice in the register.  It seems like it's only
> a display bug and doesn't double count the effect of the transaction (I'm
> sure it's because the code deciding what transactions to show in the
> register is just looking at splits and not checking for redundant listings
> of the same transaction), but it looks misleading.
>
>
>
>
The multiple display of one transaction that has multiple splits in the
same account is normal behavior in the register journal view.  If you
are in a window where you can change the register view to the basic
ledger view where splits are hidden, those extra lines disappear.

There are aspects of the program that I have not learned yet myself. 
That is why I consider every day to be a new adventure.

David C