small starting business - initial sell of shares, capital raised and related questions

[Maf. King]

On Mon 28 January 13 20:55:17 Krokodill Geena wrote:
> > Honestly, Mike's advice (to get an accountant) is REALLY on target. It
> > sounds to me as if you're in over your head, and frankly, unless you like
> > litigation and tax authority audits, then you'd be well advised to be
> > well-advised. By a professional.
> > 
> > David
> 
> Who told you I do not have an accountant?
> Accountant will not tell me how gnucash works. This is what I am
> asking from you guys: how can this "case" be resolved in gnucash?
> 
> Here is the original question:
> 
> Hi
> I need some help with the following setup
> 
> 1) Small business starts out with 0 EUR (all accounts are empty)
> 2) "Shares" of get issued and N investors buy the shares - lets say
> total of 10 000 shares, 1 EUR per share
> 3) Equipment is purchased with the money received from 2)
> 
> We need to keep track of how many "shares" are issued (there will be
> more shares issued, if there is need for additional capital)
> We do not care who has how many shares - something else is used for this
> 
<snip>
> 
> Everything started to look good but there is still one small problem.
> We know, how much cash each one of us has deposited as initial startup
> capital (and received a share in co) but there is no way to track how
> many total "shares" are actually issued.

As I said before, if each share is worth exactly €1, then the total balance of 
the Equity:ShareCapital is the number of shares which have been issued.  If  
shares have variable value, then I would (actually, I do) keep track of shares 
allocation outside of GC. 


Going back to your original question:
1. shareholders transact money between Equity:ShareCapital and Bank:Current.  
I would record one transaction per shareholder.

2. business transacts Bank:Current and Expenses:Widgets (or Assts:Capital 
Equipment:WidgetMakingMachine). Local tax rules come into play here. I'm using 
my understanding of UK rules.  Your (possible) accountant can help here.

HTH,
Maf.

>