Advanced Portfolio Income (maybe Brokerage Fees too) incorrect in switch and multiple investments transactions

[David T.]

> On Jan 14, 2017, at 12:37 PM, Chris Good <chris.good at ozemail.com.au> wrote:
> 
>> -----Original Message-----
>> From: David T. [mailto:sunfish62 at yahoo.com]
>> Sent: Saturday, 14 January 2017 3:59 PM
>> To: Chris Good <chris.good at ozemail.com.au>
>> Cc: Alberto Dante <alberto.dante at gmail.com>; gnucash-user at gnucash.org
>> Subject: Re: Advanced Portfolio Income (maybe Brokerage Fees too)
>> incorrect in switch and multiple investments transactions
>> 
>> 
>>> On Jan 14, 2017, at 4:29 AM, Chris Good <chris.good at ozemail.com.au>
>> wrote:
>>> 
>>> You seem to be saying that ‘Money In’ should include cost of stock
>> acquired as part of the DRP but that is not what the APR does.
>>> 
>>> As per https://www.gnucash.org/docs/v2.6/C/gnucash-help/report-
>> classes.html#report-assets :
>>> 
>>> Money In: Sum of the cost of stock purchased, excluding stock acquired as
>> part of a Dividend Reinvestment Plan. I.e. External money used to purchase
>> shares.
>> 
>> Chris, and others,
>> 
>> I know that I am dense when it comes to many things (and accounting is one
>> of them, for sure!), but it would seem to me that cost basis should include
>> shares purchased through a DRP. To my mind, a DRP simply combines two
>> transactions into one: 1) shares pay a dividend (income), and 2) dividend
>> buys stock. Shouldn’t that be figured into the basis? Or have I got that
>> completely wrong?
>> 
>> TIA,
>> David=
> 
> Hi David,
> 
> I don't have a preference for either way. I'm no expert on investments.
> 
> Regards, Chris Good


Chris,

Further digging around online suggests to me that DRP purchases should be included in the calculation of a stock’s basis. At least, that’s what it seems like from several investment websites I checked (e.g., www.fool.com <http://www.fool.com/>, www.investopedia.com <http://www.investopedia.com/>). I’d be curious to know why such purchases aren’t included in basis calculations for the report.

David