Re: [GNC] Rounded Up/Down Share Purchase with Dividend
Thanks to those who replied. Firstly, no: There is no holding account the reminder is allocated to for next dividend: All my other companies do that, but this one is unique. I've been thinking: the franked dividend is the 'cost' of the new share(s) regardless of their unit cost. What lead me to this conclusion, was in the case where my franked dividend would 'purchase' 1.6 shares, then it is rounded up to 2 full shares: So then I would be facing the situation where I had money 'appear' if I worked on the unit cost of 2 shares: but the real cost is the franked dividend: So I'm going to run with the 'unit' cost not being important, but the franked dividend amount being the 'cost' of the new share issue. Thanks all. On 8/6/23 12:40, ed...@billiau.net wrote: On Wed, 7 Jun 2023 17:00:34 + (UTC) mjchurchil--- via gnucash-user wrote: I guess I'm not clear on what is happening. Do you end up with 1 or 1.25 shares in your brokerage account? Mike well I have a credit left in an account associated with the share holding at the company so I start with $XX.yy in that account, a dividend is paid into that account, then an integral number of shares are purchased from that account, and there is again a remainder which now is $AA.bb ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All. ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] Rounded Up/Down Share Purchase with Dividend
On Wed, 7 Jun 2023 17:00:34 + (UTC) mjchurchil--- via gnucash-user wrote: > I guess I'm not clear on what is happening. Do you end up with 1 or > 1.25 shares in your brokerage account? Mike well I have a credit left in an account associated with the share holding at the company so I start with $XX.yy in that account, a dividend is paid into that account, then an integral number of shares are purchased from that account, and there is again a remainder which now is $AA.bb ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] Rounded Up/Down Share Purchase with Dividend
On 6/7/2023 6:54 PM, jbonn...@internode.on.net wrote: So, you get $10 dividend plus a $2 franking credit. The only amount you can do anything with is that $10, the franking credit only applies at tax time. This is why we who are not accountants in the jurisdiction should not make accounting judgements. I guess this is a question similar to the situation of those of us here who have tax withheld, earned tax credits, etc. Now I (here in the US) would be keeping things like those in my books as either an asset or expense (pre-paid against the ultimate tax bill). I'd favor the former way (treating it ads an amount the gov't owes me) because although I don't actually do a close the books, I am "reconciling" income tax at tax filing time in the following year. And asset accounts are "standing" accounts. But I am not an accountant, let alone one experienced is doing to the Aussie way. Michael D Novack ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] Rounded Up/Down Share Purchase with Dividend
So, you get $10 dividend plus a $2 franking credit. The only amount you can do anything with is that $10, the franking credit only applies at tax time. Now are you talking about a Dividend Reinvestment Plan (DRP) situation where your dividend gets reinvested in new shares of the same company? If that is the case, and the shares sell at $8, you will get one share and the company will hang onto the other $2 until you use DRP again, so it has not really vanished, it may help you get an extra share next time. I personally do not track that held amount, but you could if you wanted to, by creating a company related holding account. In my accounts that just ends up in my brokerage account, along with held amounts for other companies where I have DRP and gets drawn on perhaps next time I reinvest dividends. I trust the company to track it for me. John Bonnett -Original Message- From: gnucash-user On Behalf Of gnucash-user-requ...@gnucash.org Sent: Thursday, June 8, 2023 3:42 AM To: gnucash-user@gnucash.org Subject: gnucash-user Digest, Vol 243, Issue 13 Send gnucash-user mailing list submissions to gnucash-user@gnucash.org To subscribe or unsubscribe via the World Wide Web, visit https://lists.gnucash.org/mailman/listinfo/gnucash-user or, via email, send a message with subject or body 'help' to gnucash-user-requ...@gnucash.org You can reach the person managing the list at gnucash-user-ow...@gnucash.org When replying, please edit your Subject line so it is more specific than "Re: Contents of gnucash-user digest..." ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] Rounded Up/Down Share Purchase with Dividend
Hi xboxboy.mageia, In my experience, Australian companies usually retain the difference between the total dividend and the value of the integer no of shares reinvested for you. I track this value for each share in an asset account called Assets:Investments:Residual:[Share Code] The opening and closing residual value usually shows on each dividend. I think some companies allow you to specify to donate this residual to charity. If that is not your preference, most companies return the residual value to your dividend bank account when you change to having 0% of your dividend reinvested. Regards, Chris Good > > Message: 1 > Date: Thu, 8 Jun 2023 01:30:36 +0930 > From: "xboxboy.mageia+GnuCash" > To: "gnucash-user@gnucash.org" > Subject: Re: [GNC] Rounded Up/Down Share Purchase with Dividend > Message-ID: <79a99dd0-0f90-c283-60e3-9f9c937aa...@gmail.com> > Content-Type: text/plain; charset=UTF-8; format=flowed > > Hi Jim, > > that's just it, the $2 does 'vanish'. I don't see it, it's not passed to > me at that time, or any time in the future: > > As for a line to account for that, I guess that's what I'm asking: How > do I create an account to absorb that $2, that then disappears into the > ether? > > I hope that is clearer? > >> On 8/6/23 01:21, Jim DeLaHunt wrote: >> Hello, xboxboy.magela: >> >> You ask how to account for the $2 that has "vanished". This jumps out >> at me as the core of the problem: >> >>> Dividend (franked): Dividend reinvestment account $10 >>> Buy: stock purchase: 1 unit $8, total buy $8 >> If your dividend after franking is $10, and you buy stock for $8, then >> there should be $2 cash left over. You do not show that left over cash >> in your transaction. Where does that money go in real life?? Add a >> line for that in your transaction, and it should balance. >> >> Does this answer your question? >> >> Best regards, >> ??? ?Jim DeLaHunt, Vancouver, Canada >> >>> On 2023-06-07 08:01, xboxboy.mageia+GnuCash wrote: >>> Hi guys, >>> >>> My issue is this: I'll provide an example: Note, I'm in Australia, so >>> we have franked (taxed) dividends that we claim a tax break on. >>> >>> Total dividend $12; made up of >>> >>> Franked dividend $10 >>> >>> Imput credit (tax credit) $2 >>> >>> (So in this example $2 is paid to the tax office by the company, and >>> I receive only $10) >>> >>> But I reinvest this dividend: Say the shares are $8. >>> >>> That means with my $10, I can get 1.25 shares, but it gets rounded >>> down/up to the nearest share. >>> >>> So I get one share for a cost of $8. >>> >>> So normally I'd enter it like this: >>> >>> Expense: tax credit $2 >>> >>> Dividend (franked): Dividend reinvestment account $10 >>> >>> Buy: stock purchase: 1 unit $8, total buy $8 >>> >>> Total dividend income $12 >>> >>> Cost of share(s) $8 (normally from that dividend reinvestment account) >>> >>> (but now I'm $2 unbalanced) >>> >>> How do I account for the $2 that has now 'vanished'. With my other >>> companies, this amount gets put into an account, and I get to apply >>> it to the next dividend. But with this company, they don't do that, >>> the amount is simply 'gone'. >>> >>> Hope that makes sense, any ideas most appreciated, >>> >>> >>> ___ >>> gnucash-user mailing list >>> gnucash-user@gnucash.org >>> To update your subscription preferences or to unsubscribe: >>> https://lists.gnucash.org/mailman/listinfo/gnucash-user >>> - >>> Please remember to CC this list on all your replies. >>> You can do this by using Reply-To-List or Reply-All. >>> >> ___ >> gnucash-user mailing list >> gnucash-user@gnucash.org >> To update your subscription preferences or to unsubscribe: >> https://lists.gnucash.org/mailman/listinfo/gnucash-user >> - >> Please remember to CC this list on all your replies. >> You can do this by using Reply-To-List or Reply-All. ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] Rounded Up/Down Share Purchase with Dividend
Are you sure the company isn't offering you a fractional share for the remaining $2 , i.e. you are actually receiving 1.25 shares? Some brokers offer fractional share purchase where the share is registered in the broker's name but the investor get the benefit of the fractional share. It may possible the company is doing the same thing, it has registered ownership and you have beneficial ownership of the fractional share. If not, the company is ripping you off if they don't pay you the $2 that was not reinvested. You should be getting a cheque or payment for that amount, or as the other companies are doing accumulation of the unreinvested funds until it is sufficient to purchase a share. Even when they accumulate the funds until the next dividend, you are providing capital to the company free of any return until the next reinvestment opportunity. I would query the company and/or ASIC. On Thu, 2023-06-08 at 00:31 +0930, xboxboy.mageia+GnuCash wrote: > Hi guys, > > My issue is this: I'll provide an example: Note, I'm in Australia, so we > have franked (taxed) dividends that we claim a tax break on. > > Total dividend $12; made up of > > Franked dividend $10 > > Imput credit (tax credit) $2 > > (So in this example $2 is paid to the tax office by the company, and I > receive only $10) > > But I reinvest this dividend: Say the shares are $8. > > That means with my $10, I can get 1.25 shares, but it gets rounded > down/up to the nearest share. > > So I get one share for a cost of $8. > > So normally I'd enter it like this: > > Expense: tax credit $2 > > Dividend (franked): Dividend reinvestment account $10 > > Buy: stock purchase: 1 unit $8, total buy $8 > > Total dividend income $12 > > Cost of share(s) $8 (normally from that dividend reinvestment account) > > (but now I'm $2 unbalanced) > > How do I account for the $2 that has now 'vanished'. With my other > companies, this amount gets put into an account, and I get to apply it > to the next dividend. But with this company, they don't do that, the > amount is simply 'gone'. > > Hope that makes sense, any ideas most appreciated, > > > ___ > gnucash-user mailing list > gnucash-user@gnucash.org > To update your subscription preferences or to unsubscribe: > https://lists.gnucash.org/mailman/listinfo/gnucash-user > - > Please remember to CC this list on all your replies. > You can do this by using Reply-To-List or Reply-All. ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] Rounded Up/Down Share Purchase with Dividend
I guess I'm not clear on what is happening. Do you end up with 1 or 1.25 shares in your brokerage account? Mike On Wednesday, June 7, 2023 at 08:58:10 AM GMT-8, Michael or Penny Novack wrote: On 6/7/2023 12:00 PM, xboxboy.mageia+GnuCash wrote: > Hi Jim, > > that's just it, the $2 does 'vanish'. I don't see it, it's not passed > to me at that time, or any time in the future: > > As for a line to account for that, I guess that's what I'm asking: How > do I create an account to absorb that $2, that then disappears into > the ether? > > I hope that is clearer? How would you be entering this transaction were you keeping your books the old fashioned way using pen and ink on paper? If you can't answer that question, can't say what the accounts would be and the amount of debit or credit to each, then THAT is the problem. A more basic accounting question w=rather than a question about how to do it using gnucash instead of that old pen and ink on paper. Find yourself a basic "text" on accounting that covers things form the point of view of Australian rules, franked dividends, etc. Michael D Novack ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All. ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] Rounded Up/Down Share Purchase with Dividend
On 6/7/2023 12:00 PM, xboxboy.mageia+GnuCash wrote: Hi Jim, that's just it, the $2 does 'vanish'. I don't see it, it's not passed to me at that time, or any time in the future: As for a line to account for that, I guess that's what I'm asking: How do I create an account to absorb that $2, that then disappears into the ether? I hope that is clearer? How would you be entering this transaction were you keeping your books the old fashioned way using pen and ink on paper? If you can't answer that question, can't say what the accounts would be and the amount of debit or credit to each, then THAT is the problem. A more basic accounting question w=rather than a question about how to do it using gnucash instead of that old pen and ink on paper. Find yourself a basic "text" on accounting that covers things form the point of view of Australian rules, franked dividends, etc. Michael D Novack ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] Rounded Up/Down Share Purchase with Dividend
Hi Jim, that's just it, the $2 does 'vanish'. I don't see it, it's not passed to me at that time, or any time in the future: As for a line to account for that, I guess that's what I'm asking: How do I create an account to absorb that $2, that then disappears into the ether? I hope that is clearer? On 8/6/23 01:21, Jim DeLaHunt wrote: Hello, xboxboy.magela: You ask how to account for the $2 that has "vanished". This jumps out at me as the core of the problem: Dividend (franked): Dividend reinvestment account $10 Buy: stock purchase: 1 unit $8, total buy $8 If your dividend after franking is $10, and you buy stock for $8, then there should be $2 cash left over. You do not show that left over cash in your transaction. Where does that money go in real life? Add a line for that in your transaction, and it should balance. Does this answer your question? Best regards, —Jim DeLaHunt, Vancouver, Canada On 2023-06-07 08:01, xboxboy.mageia+GnuCash wrote: Hi guys, My issue is this: I'll provide an example: Note, I'm in Australia, so we have franked (taxed) dividends that we claim a tax break on. Total dividend $12; made up of Franked dividend $10 Imput credit (tax credit) $2 (So in this example $2 is paid to the tax office by the company, and I receive only $10) But I reinvest this dividend: Say the shares are $8. That means with my $10, I can get 1.25 shares, but it gets rounded down/up to the nearest share. So I get one share for a cost of $8. So normally I'd enter it like this: Expense: tax credit $2 Dividend (franked): Dividend reinvestment account $10 Buy: stock purchase: 1 unit $8, total buy $8 Total dividend income $12 Cost of share(s) $8 (normally from that dividend reinvestment account) (but now I'm $2 unbalanced) How do I account for the $2 that has now 'vanished'. With my other companies, this amount gets put into an account, and I get to apply it to the next dividend. But with this company, they don't do that, the amount is simply 'gone'. Hope that makes sense, any ideas most appreciated, ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All. ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All. ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] Rounded Up/Down Share Purchase with Dividend
If they take $10 for these shares then I would say your cost of share is $10, not $8. The cost of share is what you pay for it, no matter what absurd way the cost is calculated, so the money is not vanishing per se. In this case you paid $10. You could then remove it from the price database since you don't want it to be used for valuation purposes. GC assumes the price paid is good for valuation but that assumption is not always correct evidently. That said the whole thing about rounding shares is just plain weird. What would happen if you had $15 after tax to reinvest? 15/8 = 1.875. Do they round it up to 2 shares then, at which point you get a discount? Also what about just keeping the money, then separately buying new shares (so strictly speaking not "reinvesting"). Are you allowed to buy new shares at $8? On Wed, Jun 7, 2023 at 8:02 AM xboxboy.mageia+GnuCash < xboxboy.mageia+gnuc...@gmail.com> wrote: > Hi guys, > > My issue is this: I'll provide an example: Note, I'm in Australia, so we > have franked (taxed) dividends that we claim a tax break on. > > Total dividend $12; made up of > > Franked dividend $10 > > Imput credit (tax credit) $2 > > (So in this example $2 is paid to the tax office by the company, and I > receive only $10) > > But I reinvest this dividend: Say the shares are $8. > > That means with my $10, I can get 1.25 shares, but it gets rounded > down/up to the nearest share. > > So I get one share for a cost of $8. > > So normally I'd enter it like this: > > Expense: tax credit $2 > > Dividend (franked): Dividend reinvestment account $10 > > Buy: stock purchase: 1 unit $8, total buy $8 > > Total dividend income $12 > > Cost of share(s) $8 (normally from that dividend reinvestment account) > > (but now I'm $2 unbalanced) > > How do I account for the $2 that has now 'vanished'. With my other > companies, this amount gets put into an account, and I get to apply it > to the next dividend. But with this company, they don't do that, the > amount is simply 'gone'. > > Hope that makes sense, any ideas most appreciated, > > > ___ > gnucash-user mailing list > gnucash-user@gnucash.org > To update your subscription preferences or to unsubscribe: > https://lists.gnucash.org/mailman/listinfo/gnucash-user > - > Please remember to CC this list on all your replies. > You can do this by using Reply-To-List or Reply-All. > ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
Re: [GNC] Rounded Up/Down Share Purchase with Dividend
Hello, xboxboy.magela: You ask how to account for the $2 that has "vanished". This jumps out at me as the core of the problem: Dividend (franked): Dividend reinvestment account $10 Buy: stock purchase: 1 unit $8, total buy $8 If your dividend after franking is $10, and you buy stock for $8, then there should be $2 cash left over. You do not show that left over cash in your transaction. Where does that money go in real life? Add a line for that in your transaction, and it should balance. Does this answer your question? Best regards, —Jim DeLaHunt, Vancouver, Canada On 2023-06-07 08:01, xboxboy.mageia+GnuCash wrote: Hi guys, My issue is this: I'll provide an example: Note, I'm in Australia, so we have franked (taxed) dividends that we claim a tax break on. Total dividend $12; made up of Franked dividend $10 Imput credit (tax credit) $2 (So in this example $2 is paid to the tax office by the company, and I receive only $10) But I reinvest this dividend: Say the shares are $8. That means with my $10, I can get 1.25 shares, but it gets rounded down/up to the nearest share. So I get one share for a cost of $8. So normally I'd enter it like this: Expense: tax credit $2 Dividend (franked): Dividend reinvestment account $10 Buy: stock purchase: 1 unit $8, total buy $8 Total dividend income $12 Cost of share(s) $8 (normally from that dividend reinvestment account) (but now I'm $2 unbalanced) How do I account for the $2 that has now 'vanished'. With my other companies, this amount gets put into an account, and I get to apply it to the next dividend. But with this company, they don't do that, the amount is simply 'gone'. Hope that makes sense, any ideas most appreciated, ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All. ___ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user - Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.
