0 price for total loss of shares

[Stefano M Canta]

Perfect, thanks!
Instead of moving X shares at 0 price to an asset account, I moved X shares
at the original price to an income account for capital gain/loss.

Stefano

PS: in the advanced portfolio report, the expenses for each transaction
(brokerage expense) should NOT be added to the "money in" column.

Stefano


-----

Stefano Mihai Canta, Ph.D.
Electrical Engineering Specialist
Antenna Subsystem Operations

Space Systems/Loral
3825 Fabian Way M/S G-43
Palo Alto, CA 94303-4604
Tel  1-650-852-5808
Fax 1-650-308-1808


On Wed, May 15, 2013 at 5:56 PM, Steve Blackwell <zephod at cfl.rr.com> wrote:

> On Wed, 15 May 2013 10:43:00 -0700
> Stefano M Canta <cantastefano at gmail.com> wrote:
>
> > Here is my situation.
> > I have a Lending Club account where I can borrow money to somebody by
> > issuing shares that are worh 25$ each. Each share is paid back in a
> > certain amount of time, with interest, and reinvested in new shares.
> > Let's say I have 100 shares, and in a year I receive back 50$ in
> > capital and 50$ in interest, then the total shares I have are 102
> > (the original capital reinvested + 2 shares worth of interest).
> >
> > Now it happens that some people can't repay their loans. Let's say a
> > person has paid back 12.5$ and now defaults. I lose half a share. So
> > I record a loss of 0.5 shares (12.5$).
> >
> > That's when the advanced portfolio can't compute a basis if I have
> > many of these losses.
> >
> > Stefano
> >
>
> OK. I would look at this from a different angle.
>
> When someone does not replay the loan, it's not that the value of the
> "share" has changed, it's that you have lost the "share". I think you
> probably need a write-off expense account to handle the lost asset.
>
> When someone does pay you back with interest, transfer the original
>  number of shares back to you main share account and use an income
>  account for the interest and then buy more shares with the interest.
>
> HTH.
> Steve
>