How do you record stocks purchased by the company?
Are you asking about shares of companies or inventory?
LLC purchase shares of “Apple” stock.
There are differences of opinion on how to do this in Manager, but I would suggest you setup a new asset account (call it “Investments” or “Stocks”, for example). You can then record the purchase by creating a payment and posting it to the new asset account for stocks.
How your LLC is setup (single member vs. multi-member, and tax election, if applicable) would determine the best way to handle future changes in the stock’s value.
It would also depend on whether you are trading securities as a business or simply investing spare operating cash temporarily. In the first case, you might want to define the shares as inventory items. If you are going the other route, special accounts could be useful.
I recommend searching the forum. There have been several discussions about different approaches, revaluations, and so forth. This is not a simple topic, but Manager has many tools that could be useful.
Thank you Tut, I have heard of defining the shares as inventory before so that may work in this situation. It is good to know that Manager has the capability. I am trading securities as a business. Also do you have any additional recommendations on how to record the reinvestment and the dividends from the stocks? Any additional recommendations are greatly appreciated. Thank you for the software, it has been great for me.
Don’t thank me for the software. I had nothing to do with it. I’m a forum moderator, another user like you.
I have no further recommendations for you about your needs, because I’ve never used the program for securities management or trading.
I use manager to track my personal trading. I set up each company or option as an inventory item. I have a bank account that tracks the cash in my brokerage account.
When stocks are purchased, use a payment from that account, selecting the item for the company you purchased. Enter qty of shares and share price. If you are charged fees on purchase, you will ADD this to the total.
So your payment would look like this:
AAPL, 25, 122.41
Fees, .10 (if no fees, ignore this line)
Total payment 122.31
When you sell it would be a receipt:
AAPL, 25, 125.00
Fees, -.10 (NOTE the negative)
Total Receipt 124.90
I don’t reinvest dividends automatically so it’s very easy, just a receipt with no items chosen, but I suppose you could do a journal entry posting the QTY and price to the item and the credit going to a “dividend income” account.
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