Accounting transaction to realize currency gain as income in the period? |WAS >> Re: Understanding the Balance Sheet - Unrealized Gain?

[Derek Atkins]

bunk3m <bunk3m at gmail.com> writes:

[snip]
>>> I suspect this is something to do with the currency asset value but I
>>> got rid of all the last of the foreign currency and now have a zero
>>> balance in that account. 
>> Did you account for the gain/loss when you traded those foreign-currency
>> assets?
>>
> Nope.  I didn't know to do so.  My bad.  Is this written up or explained
> somewhere?  I must have missed this in the docs.

Yep, there is a whole chapter in the guide on "capital gains."  However
I would recommend instead "Selling shares" under the "Investments"
chapter: http://www.gnucash.org/docs/v2.4/C/gnucash-guide/invest-sell1.html

> I remember reading a website showing currency transactions but I didn't
> bookmark and can't find it anymore.  But I think it was more about how
> currency transactions were supposed to occur in gnuCash.  I ignored
> after reading because subsequent versions fixed whatever issue was outlined.
>
> My transactions were pretty easy .... I think.  I received some income
> in foreign currency, deposited into a foreign currency bank account;
> paid monthly bank fees in the foreign currency (transfer to Expense:Bank
> Fees); and, made a few transfers of foreign currency to current local
> currency account using transfer.  Then, closed the foreign currency
> account.  The largest volume of transactions is the bank fees.
>
> So now I have those unrealized gains on the balance sheet and am trying
> to figure out how to fix my mistakes. :-( I suspect I'll have to do some
> more reading or borrow a book from the library on foreign currency
> accounting if such a beast exists.
>
> Damn!  My head is spinning with all this stuff.

It's not too hard; the hardest part is computing the gain/loss.

> Thanks again for your help, Derek.

-derek

> B.
>
>>> Thanks again for everyone's help.
>>>
>>> Cheers!
>>> B.
>> -derek
>>
>>> On 22.03.2013 10:42 , Derek Atkins wrote:
>>>> Nope, the Unrealized Gain is literally a change-in-value of an asset
>>>> due to a change in price (exchange rate).
>>>> -derek 
>
>

-- 
       Derek Atkins, SB '93 MIT EE, SM '95 MIT Media Laboratory
       Member, MIT Student Information Processing Board  (SIPB)
       URL: http://web.mit.edu/warlord/    PP-ASEL-IA     N1NWH
       warlord at MIT.EDU                        PGP key available