Bob Gold's Avatar

Bob Gold

22 Jul, 2020 06:27 PM

Can transactions effect assets and liabilities? You say"Transactions can be between a financial account and an expense or income category, or between two financial accounts (such as a transfer from a checking to a savings account)."

What about purchases of assets? How do you account for changes in stock positions in investment accounts. Must these be an income or expense?

  1. 1 Posted by dwg on 22 Jul, 2020 09:41 PM

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    I'm a fellow user.

    More often than not transactions do effect Asset and Liabilities. For your example of a Cheque and savings account, while these have a sub designation of bank accounts they are both Assets so a transfer between them reduces the value of one and increases the value of the other, so it changes the value of these assets. A credit card is a type of liability account.

    Say you have an investment property and you set up an account for it under the Asset heading, If its purchase is reflect as a transfer from a bank account you see the bank account value decrease ( this asset is worth less) and the value of the house account increased (the value of this asset has gone up)

    What do you mean by changes in stock position? If you are talking about changes in value caused by the movement on the market this is reflect in the share price and reports in Moneydance can use the current share price to show the value. If you are talking about changes in holdings then you use buy and sell transactions to do this.

    The bottom line is at the highest level there are only 4 "types" of accounts; Assets, Liabilities, Income & Expense any other type is a sub type of these.

  2. 2 Posted by Robert Gold on 23 Jul, 2020 07:31 AM

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    Thanks very much.

    I am a Quicken user and I am considering changing.

    Your email was very helpful.

    What I meant by changes in stock position is the following. Suppose you
    have a retirement account with equities in it. The person managing it
    decides to sell 100 shares of General Motors and replace it with shares
    of Tesla. When the shares of General Motors get sold, there is cash
    generated, perhaps a gain on the sale, and a reinvestment of the cash to
    the Tesla stock. Can the investment account handle this?



  3. 3 Posted by dtd on 24 Jul, 2020 04:20 AM

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    just a user -yes - investment accounts have a "cash" position in them, so a sale of GM would put cash into the account, which could then be used to buy Tesla.

    You should probably get a customer support reply encouraging you to download the fully capable demo (with a 100 manual transactions limit) to try it out yourself.

    Good luck.

  4. 4 Posted by robertgold1951 on 24 Jul, 2020 07:13 AM

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    Thanks a lot!Sent from my Verizon, Samsung Galaxy smartphone
    -------- Original message --------From: dantdavis <[email blocked]> Date: 7/23/20 9:20 PM (GMT-08:00) To: [email blocked] Subject: Re: transactions [SyncSpace #8845]

  5. System closed this discussion on 23 Oct, 2020 07:20 AM.

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