Q:

Subject: Quickbooks for Investing

 

I noticed that you stated QB is fine for recording investments and don't need Quicken's ability to track fluxuating values in the stock.  I agree, and from a business point of view, your costs don't change daily and remained fixed.  When you sell the stock, you derive your COGS from this data.

 

However, I noticed that you didn't mention other costs associated with the purchase and sale of individual blocks of stock, such as commissions paid on purchase and on sale?  How well does QB record this information.  Do I have to do a PO every time I buy and a Invoice every time I sell, just to have a place to add commissions to the costs, or does QB have an easier way to handle this?

 

Thanks!

A:

When you make the entries for stock purchases, you need to post the total cost, including commissions.

When you sell stocks, you can either post the gross sales price to the SalePrice Income account and the Expenses to a sub-account for selling costs under that; or just enter the net sales price (gross less commissions) into the SalePrice account.  Since more and more 1099-Bs from brokers are reporting the net sales price instead of the gross price, the latter approach may be easier when it comes to reconciling the QB reports to the 1099-Bs.

Your professional tax advisor should be able to help you set up the accounts and sub-accounts in your QB file that will enable him/her to more efficiently prepare your Schedule D.

I have been posting these transactions through checks, deposits and general journal entries.  I have never used POs or invoices to do this. 

Good luck.  I hope this helps.

Kerry Kerstetter

Labels: QB

- posted by Kerry M. Kerstetter, MBA~CPA~ATP~ATA @ 2/11/2007 08:01:00 PM Send this post: