How to account for Capital Gains (Losses) in double-entry accounting?
How to account for Capital Gains (Losses) in double-entry accounting?
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William Breathitt Gray · External communityPost link
External question — Personal Finance Stack Exchange
Author: William Breathitt Gray
Original post: https://money.stackexchange.com/questions/22258
License: CC BY-SA 3.0 — https://creativecommons.org/licenses/by-sa/3.0/
Adaptation: HTML converted to plain text; contact email addresses removed.
After taking an introductory financial accounting class, I decided to use GnuCash to keep track of my personal finances. I have 5 major accounts in my general ledger:
Equity
Currently only used to record
opening balances
for other accounts.
Assets
Subaccounts for
Bank
,
Cash
, etc.
Liabilities
Subaccounts for
Credit Cards
Income
Sources of income, such as
Salary
and
Gifts
.
Expenses
Sources of expense, such as
Groceries
and
Gas
.
This worked out well for the past year. However, I've recently had to record the
capital losses
I made on a short-term forex trade, but I can't remember how to record this.
In particular, do I use
two
separate accounts as such:
Income
>
Capital Gains
Expenses
>
Capital Losses
Or just
one
Capital Gains (Losses)
account where a
negative
balance indicates a capital
loss
?
if just a single account, would this account be under
Equity
or
Assets
?
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Quoted from Forex.com.bd-Editorial External question — Personal Finance Stack Exchange Author: William Breathitt Gray Source score (net votes, not local likes): 14 Original post: https://money.stackexchange.com/questions/22258 License: CC BY-SA 3.0 — https://creativecommons.org/licenses/by-sa/3.0/ Adaptation: HTML converted to plain text; contact email addresses removed. After taking an introductory financial accounting class, I decided to use GnuCash to keep track of my personal finances. I have 5 major accounts in my general ledger: Equity Currently only used to record opening balances for other accounts. Assets Subaccounts for Bank , Cash , etc. Liabilities Subaccounts for Credit Cards Income Sources of income, such as Salary and Gifts . Expenses Sources of expense, such as Groceries and Gas . This worked out well for the past year. However, I've recently had to record the capital losses I made on a short-term forex trade, but I can't remember how to record this. In particular, do I use two separate accounts as such: Income > Capital Gains Expenses > Capital Losses Or just one Capital Gains (Losses) account where a negative balance indicates a capital loss ? if just a single account, would this account be under Equity or Assets ?
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