[GNC] Help - how to account for a Distribution Reinvestment that is a Return of Capital

[bunk3m]

I'm trying to figure out how to account for a quarterly distribution 
that I receive from an investment (call it "LP") that is converted into 
new units.  While that would be similar to a distribution reinvestment 
(DRIP), the income is a return of capital not income.

I can't figure out how this is supposed to be done in Gnucash.  While I 
found parts of this transaction in tutorial and guide, I'm still confused.

So the way I understand things, this is what I should see in the first 
quarter after 50 units of LP were purchased at $10/unit and total of 
$500.  Return of capital $40 that is reinvested in 4 units.

Initial purchase in first quarter:
[Asset:Investments:PrivateEquity:LP]	$500
being 50 units at $10/unit
[Cash]					-$500

Distribution amount $40 (Price still $10/unit) in second quarter.

After distribution there should be $540 in asset value of the units of 
LP since there are now 54 units @ $10/unit.  But the cost base of the 
investment should be, I think, $500 ($500 initial investment - $40 
return of capital + $40 return of capital reinvested in units).

Is this conceptually what is supposed to happen?  If so, how do I get 
Gnucash to show this?  When I try to do the return of capital I end up 
with the correct number of units but lower value and $40 income.

Is a reference to help me understand this please let me know where to 
find it.

Thanks.