Personal Finance & Money Asked by wchlm on May 6, 2021
How do I record changes in the values of shares that I hold at the close of a reporting period in double-entry accounting? I.e., what transactions are made?
I am interested in any standard or typical ways of recording such changes for shares that I hold personally, as investments for the future.
For personal accounting (i.e. your own "balance sheet") you could create an entry for "unrealized gain" that you would then need to clear out when you sell the stock and it becomes "realized". You'd also have to decide when to account for unrealized gains - once a year? Once a month? Or just leave the value at cost and track unrealized investment gains elsewhere (since it doesn't really matter until you realize the gains)
Businesses typically do not record unrealized gains in the balance sheet except in certain circumstances, the details of which are off-topic for this forum. (search for "Cost Method and "equity Method" for details)
Answered by D Stanley on May 6, 2021
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