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- Chapter 5 - Questions and Answers
-
-
- ===>>> This chapter lists questions and answers pertaining to
- potentially confusing points. They represent well over 75% of the
- questions we receive from users. This may be the most important
- chapter of this manual. I suggest you read it carefully, and refer to
- it if you don't understand something.
-
- 5.1 General Usage
-
-
- 5.1.1 "What do the functions 'Form Accept' and 'Form Reject', listed
- at the bottom of forms, mean?"
-
- ===>>> These are short cut keys. Hitting the Form Accept key is the
- same as hitting Enter on each of the fields. The net result is that
- the record is written to disk. Hitting the Form Reject key is the same
- as hitting Esc on all of the fields. The net result is that you return
- to the prior table or menu.
-
- These keys are more or less a matter of preference. The best use of
- the Form Accept key is on the User Settings or Report Settings Forms.
- After changing a value near the top, you can use Form Accept instead
- of hitting Enter on all the remaining fields. Similarly, you can use
- Form Reject if you are near the bottom of one of these forms and
- decide against the changes you just made.
-
- 5.1.2 "What's the best way to get started?"
-
- Follow along with the demo/tutorial screen show. Or, read the Quick
- Tour chapter in the users manual. Also, I strongly urge you to read
- this entire chapter. Roughly 75% of the questions asked are
- represented here. Finally, if you installed the Example Data, you can
- play around with it for awhile.
-
- 5.1.3 "Why is the XYZ Table hard to read?"
-
- Capital Gainz' default screen colors sometimes are hard to see on CGA
- screens or laptops. You can use the Colors option on the User Settings
- Form to alter them to your liking. Or, before starting Capital Gainz,
- issue the DOS command:
-
- C:> MODE BW80
- or
- C:> MODE MONO
-
- Then, Capital Gainz runs as if it is using a monochrome monitor.
-
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- Capital Gainz Users Manual 5-1
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- 5.1.4 "Why does Capital Gainz stop immediately with an error of 'Too
- Many Files Open'?"
-
- DOS normally creates a base CONFIG.SYS with FILES set to 10 (or 20).
- Capital Gainz opens many files, so this value should be increased. For
- most users, a value of 40 is sufficient. You also may bump up the
- BUFFERS statement to 20. During installation, you can request that
- these changes be made automatically to your CONFIG.SYS. The new values
- don't take effect until you reboot.
-
- Also, you may have used Ctrl-Esc in DOS 5.0, causing Capital Gainz to
- be swapped out of memory. If you try to start Capital Gainz again, the
- one suspended in memory is still holding file handles. See your system
- documentation for how to swap suspended tasks back into memory. You
- should also look into remapping Ctrl-Esc, as explained in Chapter 16.
-
- 5.1.5 "When I try to run Capital Gainz, it stops and prints a DOS
- error."
- "When I run Capital Gainz it hangs immediately."
- "When I run Capital Gainz, it stops with an internal error."
- "When I install Capital Gainz, the installation procedure aborts."
-
- These are all symptoms of a corrupted file, usually caused by diskette
- damage in the mail or line noise during electronic downloading. See
- Chapter 3 for information on installation errors.
-
- 5.1.6 "Holy moley! Why is the users manual so long?"
-
- I'd get too many complaints if it was too short. I want to explain
- everything about Capital Gainz, so you can manage your investments
- correctly and efficiently. You should only read selected chapters,
- leaving the rest for reference.
-
- 5.1.7 "I accidentally deleted some files with the .K01 extension.
- What do I do?"
-
- The files with the .K01 extension are index files, providing fast
- access to the data files (.DAT). If a .K01 file does not exist for a
- data file, Capital Gainz will automatically build it on startup.
-
- 5.1.8 "Why does Ctrl-Esc bring up the Task List instead of escaping
- from the Capital Gainz form?"
-
- ===>>> If you are running Capital Gainz under Microsoft Windows, then
- Windows grabs the Ctrl-Esc sequence before it gets to Capital Gainz.
- The same goes for DOS 5.0. You can redefine the Form Accept and Form
- Reject short cut keys for Capital Gainz in the User Settings Form.
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- 5-2 Capital Gainz Users Manual
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- 5.1.9 "Why can't I execute Capital Gainz from a different directory?"
-
- Capital Gainz assumes all the data files, along with the CAPGNZ.INF
- and ERROR.DAT files, are in the current directory when you execute
- Capital Gainz.
-
- 5.1.10 "Why does Capital Gainz report that no Help is available?"
-
- The Help facility uses the online documentation files. If you did not
- install the documentation, or moved the documentation from the
- directory you specified at installation, then no help is available.
- You need to re-install the documentation or modify CAPGNZ.INF.
-
- 5.1.11 "Why does Capital Gainz halt with an error of 'Insufficient
- Memory'?"
-
- Capital Gainz requires about 512KB of free conventional memory to run.
- Generally, this requires 640KB of installed memory. If your drivers
- and TSRs consume too much conventional memory, then there's not enough
- memory for Capital Gainz to run. See Chapter 23 for suggestions on how
- to alleviate this problem. There are several utilities, such as DOS
- 5.0's MEM command, available that tell you how much free memory you
- have. Also, the amount of available free memory is displayed at the
- bottom of the Main Menu.
-
- Sometimes users run menu or shell programs that don't leave enough
- memory for Capital Gainz to run. In this case, you must terminate the
- menu or shell program and run Capital Gainz from the DOS prompt.
- Alternatively, you may be able to run the menu or shell program in
- high memory.
-
- Even if you have more than 640KB of memory, you still must free up
- enough conventional memory. Programs must be specifically written to
- directly use any expanded or extended memory beyond 640KB.
-
- If you absolutely can't free up any more memory, you may be able to
- use Capital Gainz by not going too 'deep'. For instance, always add
- securities using the Global Security and Security options from the
- Main Menu, rather than from lookup tables when recording activity.
-
- 5.1.12 "Why does Capital Gainz halt with 'Invalid Record
- Declaration'?"
-
- ===>>> You are trying to execute Capital Gainz against data files
- created with a different version of Capital Gainz. You need to upgrade
- your data files with the Utility Program.
-
- 5.1.13 "What do 'Function List' and 'More' mean on some of the
- tables?"
-
- ===>>> Capital Gainz always tries to display functions available at
- each point in the program. However, as much data as possible should be
-
- Capital Gainz Users Manual 5-3
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- displayed in tables, instead of consuming valuable screen space with
- lists of functions. To compromise, when all functions do not fit on a
- single line, Capital Gainz lets you popup a list of available
- functions, or scroll horizontally through them. Function List pops up
- a list of available functions, and you can highlight the one you want
- and hit Enter to execute it. Or, you can scroll through the list of
- functions at the bottom of the screen with the key labeled More.
-
- A function does not have to be displayed in order to be invoked. For
- instance, say you frequently use the Price Update function on the
- Local Security Table and remember that the associated key is function
- key 4. You don't have to scroll through the functions until Price
- Update is displayed to invoke it.
-
- 5.1.14 "Why do some entities have Tables and Lookup Tables? Why not
- always use the normal Table, with all functions available?"
-
- Separate lookup tables are used in order to show more values faster,
- and also to reduce memory requirements. For instance, while the Local
- Security Table takes 4 lines per security, the Local Security Lookup
- Table only uses a single line per security. Less information is shown,
- but it's faster to bring up than the full table.
-
- 5.1.15 "When I exit from Capital Gainz, why is the message 'Type EXIT
- to return to Capital Gainz' displayed? Also, why can't I start up
- Capital Gainz?"
-
- You are using the GoTo DOS function on the Main Menu. GoTo DOS means
- that Capital Gainz is temporarily suspended while you do something in
- DOS. Typing EXIT returns to Capital Gainz. Trying to execute CG.BAT or
- CAPGNZ.EXE will fail if Capital Gainz is suspended. To exit completely
- from Capital Gainz, use the X) Exit to DOS choice on the Main Menu.
-
- 5.1.16 "I'm having some problems that are hard to explain. What's the
- best way of getting help?"
-
- For complicated problems, the best way to get help is to send copies
- of your data files on a diskette, along with an explanatory note. The
- files to include are: *.DAT and *.K01. I understand that these contain
- sensitive data. If you'd like, you can use the Hide Account Numbers
- option in the Utility Program to blank out the account numbers in the
- security files on the diskette.
-
- 5.1.17 "Why is CG.BAT missing?"
-
- CG.BAT is created at installation. If you did not use the normal
- installation routine, CG.BAT will be created the first time you
- execute CAPGNZ.EXE. You can then modify it as necessary.
-
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- 5-4 Capital Gainz Users Manual
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- 5.2 Passwords
-
-
- 5.2.1 "Can I secure my data from other people who use my computer?"
-
- Use the Set Password function on the Main Menu to password protect
- access to the program. If you leave the password blank, Capital Gainz
- does not prompt for password entry.
-
- 5.2.2 "I forgot my password. Can I just delete the password file?"
-
- ===>>> No! If it were this easy to circumvent the password system, it
- would be useless. To regain access to Capital Gainz, you must
- reinstall the Program Data files. Capital Gainz will not run if there
- is no Password File. However, if you leave the password blank, Capital
- Gainz does not prompt for password entry. Thus, security really
- requires two actions on your part: set a non-trivial password, and
- secure the Capital Gainz installation disks.
-
- 5.2.3 "Why do I keep getting 'Invalid Password', even though I'm
- entering the correct password?"
-
- If you get this error, then you aren't entering the exact string you
- specified when you set the password. Remember that passwords are case
- sensitive, and blanks are allowed in the string. (But trailing blanks
- are ignored.)
-
- 5.2.4 "Why are '.'s displayed when I enter a password?"
-
- To prevent someone from seeing the password as you type it in.
-
- 5.3 Purchases, Sales, and Distributions
-
-
- 5.3.1 "Do I have to enter all of my prior purchases and sales to get
- started?"
-
- Unfortunately, if you want accurate performance calculations, you
- really have to. There's no other way if you want historical gain/loss
- and return figures. Also, in order to match purchases with future
- sales, and determine long/short term holding periods, all purchases
- must be recorded. It's not too difficult to sit down with the year-end
- statements and enter data. The Buy Shares Form is repeatedly accepted,
- the number of open shares is shown on the Buy Shares Form, and Capital
- Gainz pre-fills some fields and calculates others.
-
- There are two short cuts available. You can only record purchases that
- you still own. For instance, if you've been buying and selling shares
- of a mutual fund over some time period, you only really need to record
- purchases that are still open.
-
- Another alternative is to lump all of your holdings into two groups,
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- long and short term. Record one big purchase equal to the total shares
- and amount of the long term group, and make sure the difference
- between the current date and the purchase date exceeds the holding
- period. Then, record the individual short term purchases. Technically,
- you should then use an averaging method, since you did average the
- long term holdings. However, this is between you and the IRS. The
- ultimate outcome will be the same whether you use averaging or not.
- This approach works great with money market funds, since they maintain
- a constant price anyway. Ironically, this 'grouped purchase' approach
- won't work with mutual funds that you've already sold shares of using
- an averaging method - unless you adjust the amounts and prices.
-
- 5.3.2 "How do I change or delete a buy, sell, or distribution entry?"
-
- ===>>> To change or delete activity, you need to choose Log
- Maintenance on the Main Menu. Then, from the Log Maintenance Menu,
- choose the type of activity and date range. Next, fill in the symbol
- field on the Log screen. The buy, sell, or distribution activity for
- the symbol is displayed in a table from oldest to most recent. Use the
- Up Arrow, Down Arrow, PgUp, PgDn, Ctrl-PgUp, and Ctrl-PgDn keys to
- highlight the entry you want to change or delete. Hit Enter to change
- the highlighted entry, or Del to delete it. After hitting Enter, the
- activity form pops up with the current values filled in, and you make
- your desired changes. After hitting Del, the activity form pops up
- with the current values filled in, and you are prompted to confirm the
- deletion.
-
- 5.3.3 "How do I record purchases/sales of a mutual fund that charges
- a load?"
-
- Loads are treated similarly to commissions, but calculating them is a
- little more difficult. A $35 commission on a $1000 purchase means you
- paid $1035, invested $1000 of it, and paid $35 to the broker. A $35
- load on a $1000 purchase, which is a 3.5% load, means that you paid
- $1000, invested $965 of it, and paid $35 to the mutual fund. To make
- things more difficult, the load price, the Net Asset Value, or both
- may be listed in your statements and quoted in the mutual fund
- listings. The Calc Load/Comm function, available on the Buy Form, Sell
- Form, and Price Form will help you out. Chapter 7 contains details and
- examples.
-
- 5.3.4 "How can I record a purchase for $0.00?"
-
- Capital Gainz usually requires non-zero values for shares, price, and
- amount. If you want to set one or more of these to zero, turn off
- calculations and value checking with the Calc Off key. This key
- toggles calculations on and off.
-
- Before you record a purchase at $0.00, be sure that's what you really
- want to do. If shares are given to you as a present, or in a will,
- they should generally be recorded at their current fair market value,
- with that value reported as normal income on your taxes. A good way to
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- handle this in Capital Gainz is to record the purchase at the
- security's current price, then record a negative commission equal to
- the purchase amount. The gain calculation will use a basis of $0.00,
- and the negative commission will be reported in the tax report as
- income for that year.
-
- 5.3.5 "Why is the Per Share calculated on the Distribution Form so
- low?"
-
- You are misinterpreting the meaning of the Per Share field. It is not
- the price, but rather the per share amount of the distribution:
- distribution_amount/shares.
-
- 5.3.6 "How do I know what the per share amount of a distribution is?"
-
- For stocks and bonds, this is the dividend rate. For mutual funds,
- check your statements immediately after receiving a distribution, as
- they usually include a per share value. If not, the value calculated
- by Capital Gainz is usually close enough to provide fairly accurate
- yield and total return figures. More exact per share values mean more
- accurate yield and total return calculations.
-
- 5.3.7 "I've been using the per share value in the Distribution Form
- wrong. Do I have to change them all?"
-
- There's a function on the Distribution Log, Recalc Per Share, that
- will recalculate the per share values for the displayed distribution
- records. This function is pretty slow, but at least you don't have to
- do it by hand. The calculated values should be very close to the
- actual per share values.
-
- 5.3.8 "Does the order that I enter activity matter?"
-
- ===>>> Prior to version 3.1, you should have entered purchases, sales,
- and distributions in chronological order. This was because the default
- price displayed for a purchase was based on the most recent price, the
- default selling price was based on the most recent price, and the
- distributions/share amount calculated for a distribution was
- calculated based on the current number of open shares. Of course, it
- was easy just to enter the correct values from your statements. If you
- didn't record entries in order and did not change the
- distributions/share value, then displayed yield figures would be
- incorrect.
-
- Prior to version 3.0h, you had to execute sales before recording any
- subsequent purchases if you didn't use the FIFO (first-in/first-out)
- or ID (specific identity) selling methods. This was because the
- purchases affected by the sale were not limited by the selling date
- entered. As of version 3.0h, this restriction was eliminated, and open
- shares selected for the sale are limited by the selling date. When
- using averaging methods, the average price is recalculated for the
- sell date, based on the activity logs.
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- As of version 3.1, the default price shown for a purchase or sale is
- the closest dated price found in the price history, and the
- distribution per share amount is calculated based on the number of
- shares held on the distribution date. With two exceptions, the order
- that activity is entered doesn't matter. First, entering activity out
- of order is somewhat slower. For instance, if you enter a dividend
- after recording subsequent purchases, Capital Gainz must process the
- activity logs, determining the number of shares held on that date,
- before calculating the per share value. Second, and more important, is
- that each sale should not be entered until all prior purchases and
- sales have been recorded.
-
- To explain the restriction on sales, assume you buy 10 shares at $11
- on 1/1/91, 10 shares at $12 on 2/1/91, and 10 shares at $13 on 3/1/91.
- If you executed a LIFO (last-in/first-out) sale of 10 shares on 4/1/91
- prior to recording the 3/1/91 purchase, the shares bought on 2/1/91
- would be incorrectly selected. Or, say you use the average selling
- method, and enter all 3 purchases correctly, but record a 10 share
- sale on 3/2/91 and then a 10 share sale on 2/2/91. The 2/2/91 sale
- should close 10 shares at an average price of $11.50, and the 3/2/91
- sale should close 10 shares at an average price of $12.25. By entering
- the sales out of order, the 2/2/91 sale would use the correct $11.50
- basis, but the 3/2/91 sale would use a $12 basis. The prices used are
- the average prices at the time the sales are recorded. Since the
- 3/2/91 sale didn't 'know' about the 2/2/91 sale, the basis was
- incorrectly calculated.
-
- 5.3.9 "I have a 401K Plan that sends statements, but does not include
- the number of shares or the share price. How can I track this in
- Capital Gainz?"
-
- ===>>> At first glance, you may want to record the purchases at a
- fixed price of $1.00, then somehow record a gain or a loss. However,
- since no gain or loss has actually been realized, this is incorrect.
- The best way to handle this type of investment is to use a fixed price
- of $100.00, which allows greater precision than $1.00. Set the selling
- method for the local security to the average method, so shares you
- withdraw will have the same basis as those you leave in. When you
- receive a statement showing your gain/loss, use the Price Update
- function on the Local Security Form. From the Price Form, choose the
- Price From Value function. Enter the value from your statement in the
- Value Form, and the corresponding price is calculated for you. Now
- your investment shows the corresponding gain or loss, but it is
- unrealized. Use the last calculated price for subsequent purchases.
- The Price From Value function is also available when you choose Update
- Prices/From Screen. Chapter 7 contains details and examples.
-
- 5.3.10 "My wife and I work for the same company and each contribute
- to the 401K plan. We need to use the Price From Value feature to
- tracks gains and losses. Can we use a single global security, and link
- two local securities to it?"
-
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- No. Since the Price From Value feature derives a price from the value
- of the security, the price for these two 401K plans will differ unless
- identical contributions are made. Use a unique global security for
- each 401K local security.
-
- 5.3.11 "Can I enter multiple activity on a single date for a
- security?"
-
- Yes. You can have multiple purchases, multiple sales, and/or multiple
- distributions on a given date for a single security. For instance, you
- can have two purchases for Mutual Fund XYZ on 1/15/91. You can also
- have purchases, sales, and distributions on the same date. For
- instance, you can receive a dividend and purchase shares with the
- amount on the same date. When a distribution is recorded, the per
- share amount is calculated based on the number of shares held as of
- the beginning of the specified date. This allows for accurate per
- share calculations when a mutual fund pays dividends and capital gains
- on the same day. However, when selling shares, the number of shares
- available to be sold are the number as of the end of the specified
- date. Likewise, the average purchase price for the average selling
- method is calculated as of the end of the day.
-
- When activity is entered on the same date, the following order is
- assumed:
- 1) Distributions, 2) Purchases, 3) Sales.
-
- ===>>> You should avoid having multiple sales on a single date if you
- are using the average selling method. This is because accurate average
- prices rely on the chonological order of sales.
-
- 5.3.12 "Why aren't the other fields recalculated on the Buy Shares or
- Sell Shares Forms when I change the amount, so that
- price*shares=amount?"
-
- The Shares and Price fields are only calculated if they are 0. The
- reason these fields are not automatically adjusted is that Shares
- multiplied by Price doesn't have to be equal to Amount, although it
- should be very close.
-
- 5.3.13 "Is it OK to delete old distribution and closed shares
- records?"
-
- ===>>> You really shouldn't delete the old records, as they are used
- to determine your overall performance with the security. If you use
- the average selling method, don't delete the closed shares records,
- since they are required to calculate the current average price. If you
- end up selling all shares of a security and want to clean up, I
- suggest defining an 'inactive' portfolio, and using the Utility
- Program to move the closed out security to it. You can put this new
- portfolio on a floppy disk, if you'd like.
-
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- 5.3.14 "How do I record an IRA maintenance fee?"
-
- ===>>> To record an IRA fee, fill in the Distribution Form using the
- FEE type. If you paid the fee with a separate check, then that's all
- you need to do. If you let the fund company sell shares to get the
- fee, you'll need to record the sale. After recording the fee, answer
- YES to the Sell Shares to Cover Fee question. This process is similar
- to recording a dividend and the subsequent purchase. These are the
- only two ways that mutual fund IRA maintenance fees are handled. If
- you did not send a separate check, look for the sale in your
- statements. Capital Gainz prints out a list of any recorded fees after
- Schedule B, with a comment to the effect that they may be tax
- deductible.
-
- 5.3.15 "How can I see a chronological list of activity?"
-
- The Mixed Detail Report shows a chronological listing of purchases,
- sales, and distributions for a security, similar to the mutual fund
- statements.
-
- 5.3.16 "When I record a purchase, why does the number of shares
- calculated by Capital Gainz differ from my mutual fund statements?"
-
- There are occasionally rounding errors, but more than likely you need
- to adjust the precision settings for the local security. One setting
- specifies how many decimal places to calculate the number of shares
- to, and the other specifies the number of decimal places for prices
- and distributions per share. If your mutual fund company statements
- carry the number of shares to .001 and the price to .0001, then set
- the share precision to 3 and the price precision to 4. If these values
- are set correctly, the figures calculated by Capital Gainz should
- usually be the same as those on your statement. If there are minor
- differences, then use the values from the statement. If there are
- significant differences, verify that your entries and statements are
- correct.
-
- 5.3.17 "I have a stock that was taken over by another company in a
- stock swap. How do I record this?"
-
- Recording a non-taxable stock swap purchase takes several steps.
- First, you need to adjust the number of shares and the basis of the
- shares. Use the Stock Split function for this. For example, if you
- received one new share for each three shares you owned, then execute a
- 1-for-3 stock split. Next, change the local security to reflect the
- new security's symbol. Finally, change the global security to reflect
- the new security's symbol and name.
-
- 5.3.18 "How do I record and then cover a short sale?"
-
- To record a short sale, use the Sell Shares activity. From there,
- specify the SHRT (short sale) selling method. When you purchase shares
- of that local security, Capital Gainz will prompt you to cover any
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- outstanding short sales.
-
- 5.3.19 "Why was the Double Category selling method discontinued?"
-
- The Double Category selling method is a cruel joke on the part of the
- authors of the tax laws. Maintenance is horrendously difficult, even
- with a computer program. The major reasons why it is no longer
- supported are:
-
- There is no difference between short and long term tax rates. Even
- if there were, last-in/first-out or specific identity are superior
- selling methods.
-
- This method is far more complicated than many users assume. Actions
- such as recording sales out of order, or changing the holding
- period can have numerous side effects. It's very easy to make a
- serious error.
-
- Roughly 50% of our testing was devoted to the Double Category
- method, given its complicated nature. As the program gets more
- complex, the price would have to be raised considerably and new
- features would be delayed.
-
- Dues to an omission in the tax laws, it's impossible to account for
- changes in the holding period.
-
- 5.3.20 "I have a security that uses the Double Category selling
- method. What do I do?"
-
- This method is still available for any securities that were already
- using it, but share migration is no longer managed. To continue using
- it, you must manually maintain the values in the local security using
- the Fixup option. You are strongly urged to discontinue use. If you
- haven't sold any shares, simply change to a different selling method.
- If you've only sold shares from the long term category, it seems
- reasonable that you can switch to the Single Category method after
- migrating all of the short term shares. However, there is no mention
- of this in the IRS documents. If you have sold short term shares,
- you'll either have to manually maintain these securities within
- Capital Gainz, or backtrack and redo prior sales with another method,
- filing amended taxes as necessary. Seek advice from your accountant or
- the IRS documentation.
-
- 5.3.21 "What selling methods am I allowed to use?"
-
- ===>>> According to the IRS publications, anytime you have multiple
- purchases of a security, you are assumed to use the FIFO (first-
- in/first-out) method unless you provide explicit prior written
- identification of the shares you want to sell to the agent
- responsible. For mutual funds, you can also use the average selling
- method without notifying the agent. However, once you use the average
- method, you must continue to use it as long as you hold shares of that
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- fund.
-
- 5.3.22 "What good are the LIFO (last-in/first-out), MAX (maximum
- gain/minimum loss), MIN (maximum loss/minimum gain), and ID (specific
- id) selling methods if I must provide prior notification to the
- selling agent?"
-
- The best use of these methods is to execute the sale, print the report
- of shares that would be sold, then don't confirm the sale. A copy of
- this report can be sent to the selling agent along with an explanatory
- note. Upon confirmation of the sale, you can re-execute the sale in
- Capital Gainz and confirm it. Make sure that the sell date is prior to
- any purchases recorded in the interim.
-
- 5.3.23 "I made an error in a previous sale. Do I just unsell the
- shares then re-execute the sale to fix it?"
-
- ===>>> Usually, you can do this. However, be careful if any sales
- follow the one you want to change. Changes to a prior sale can
- potentially affect subsequent sales, especially when using the
- averaging sell method. In this case, you should unsell all sales from
- the one you want to change to the most recently recorded sale, make
- your changes, then re-execute all of the sales in order.
-
- To explain this, assume you recorded purchases of 10 shares at $10 on
- 1/1/91, 10 shares at $12 on 2/1/91, and 10 shares at $13 on 3/1/91.
- Also, you recorded a 10 share sale on 2/2/91 at an $11 basis and a 10
- share sale on 3/2/91 at a $12 basis, using the average selling method.
- If you notice that the purchase on 1/1/91 should have been at $11,
- then you must unsell both sales, make the change, then re-execute the
- sales. This correctly results in an $11.50 basis for the 2/2/91 sale
- and a $12.25 basis for the 3/2/91 sale. If you only unsell the 2/2/91
- sale, make the change, and re-execute the sale, you end up with an
- $11.50 basis for the 2/2/91 sale and the incorrect $12 basis for the
- 3/2/91 sale would not change.
-
- You can also change the open information for the closed shares record.
- This is NOT recommended if you used the average selling method.
-
- 5.3.24 "After recording a distribution, I answered YES to reinvest
- the shares. Why don't these shares show up in the Open Shares Log?"
-
- After recording a distribution and answering the reinvestment
- question, you still must complete the Buy Form that Capital Gainz
- brings up. Usually, all of the information is filled in correctly
- except for the price. Often, users mistakenly escape out of this form.
- Remember that reinvestment is a two step process: you must record the
- distribution AND the purchase.
-
-
-
-
-
- 5-12 Capital Gainz Users Manual
-
-
-
-
- 5.3.25 "When recording a distribution, why does Capital Gainz
- sometimes ask me if I want to use a distribution per share from a
- given date?"
-
- You already recorded a distribution for a local security linked to the
- same global security, or you entered a distribution for the global
- security in the Price History Table. When you go to record a
- distribution, Capital Gainz checks if you have recently added a
- distribution for the global security. If so, you are asked if you want
- to use that distribution. If you answer YES, Capital Gainz fills in
- the information and will not make another entry in the price history
- table for that global security. If you answer NO, Capital Gainz
- assumes that you are recording a completely different distribution.
-
- 5.3.26 "Why aren't the shares purchased with reinvested dividends
- shown with the distributions?"
-
- ===>>> Shares purchased by reinvesting distributions are not
- associated with the distributions. The distribution and the share
- purchase are recorded separately. The reinvestment feature of Capital
- Gainz simplifies this two-step process, but the records created are
- not related.
-
- 5.3.27 "How can I enter Interest instead of Dividends?"
-
- ===>>> Whether a security receives dividends or interest is determined
- by the security type associated with the global security. The Security
- Type Table shows which security types get dividends or interest. You
- can change this for a given security type.
-
- When recording a distribution, Capital Gainz determines whether the
- associated global security is set to receive dividends or interest.
- Depending on how it was defined, the distribution type choices include
- DIV or INT.
-
- 5.3.28 "I made an error recording a distribution reinvestment. Do I
- need to delete it and re-enter it?"
-
- Capital Gainz manages reinvested distributions by simply taking you to
- the Buy Shares Form and filling in the values after you record the
- distribution. The distribution and subsequent purchase are not linked.
- To change a reinvested distribution, you need to change the open
- shares record, distribution record, or both. For instance, if you were
- changing the share price of the reinvestment, only change the open
- shares record. However, to change the distribution amount, you'll need
- to change both the open shares record and the distribution record.
-
- 5.3.29 "How do I record a stock dividend?"
-
- You need to distinguish between taxable and non-taxable stock
- dividends, as well as between stock dividends of identical shares and
- those of different shares. I'll briefly describe each, but suggest
-
- Capital Gainz Users Manual 5-13
-
-
-
-
- reading IRS publication 550 or consulting with a tax professional.
-
- For non-taxable stock dividends with identical shares, you must adjust
- the number of shares you own and their basis price. So, if you
- received 8 shares as a stock dividend on the 200 shares you previously
- bought at $5/share, your basis is still $1000, but the number of
- shares is now 208. If you sold 100 shares, the basis price is
- ($1000/208) = $4.8077 and the basis amount is $4.8077 * 100 = $480.77.
- If the 200 shares you owned were bought 100 at $2 each and 100 at $8
- each, then the two lots would be adjusted to 104 shares at $1.9231
- ($200/104) and 104 shares at $7.6923 ($800/104). As you can see, these
- calculations are simply stock splits: a 208 for 200 split multiplies
- the shares by 208/200, and multiplies the price by 200/208. In the
- first example, 200 * 208/200 = 208 shares, and $5 * 200/208 = $4.8077.
- In the second example, 100 * 208/200 = 104 for each lot, $2 * 200/208
- = $1.9231 and $8 * 200/208 = $7.6923. So, to record a non-taxable
- stock dividend of identical shares, record a stock split of:
-
- (shares_owned + new_shares)/shares_owned
-
- A non-taxable stock dividend of non-identical shares is more
- complicated. Say you have 200 shares of common stock bought at a price
- of $5. You receive 8 shares of preferred stock for each 200 shares of
- common. At the time, the listed price of the common was $6, and the
- listed price of the preferred was $2.50. The basis of the shares you
- own is $5 * 200 = $1000, and the value is $6 * 200 = $1200. The value
- of the shares you receive is $2.50 * 8 = $20. You must divide the
- basis with the ratio $1200/($1200 + $20) = .98361 for the common, and
- the ratio $20/($1200 + $20) = .01639 for the preferred. Thus, the
- common you owned is changed to a basis of $1000 * .98361 = $983.61,
- and the basis of the new preferred is $1000 * .01639 = $16.39. Capital
- Gainz will not automatically handle this situation - it's tempting to
- apply a split of $1200/$1220 to the common, but the number of shares
- should not change. Instead, you must adjust the prices of all open
- shares of the common stock, define the preferred security, then record
- the purchase of the preferred security.
-
- A stock dividend is taxable if you have the option of receiving shares
- or cash, or if the distribution is not applied evenly to all
- shareholders. In this case, I suggest recording a cash dividend, then
- reinvesting it. If the shares are non-identical, you'll need to define
- the new security first, so you can reinvest the distribution.
-
- 5.3.30 "How do I buy shares using a money market fund, or sweep sale
- proceeds into a money market fund?"
-
- Treat a money market account like any other security. To buy shares
- from a money market fund:
- - Make sure Redistribute Proceeds is set to YES in the User
- Settings.
- - Execute a sale against the money market fund for the desired
- amount.
-
- 5-14 Capital Gainz Users Manual
-
-
-
-
- - When the sale is complete, answer YES to the redistribute
- question.
- - Complete the form that comes up to purchase another security.
- Sweeping proceeds into a money market fund is identical, except you
- sell the other security and purchase shares of the money market fund
- with the proceeds.
-
- 5.3.31 "How do I record a payment of accrued interest?"
-
- According to the IRS documents, all interest payments should be
- recorded on Schedule B, with any accrued interest payments listed as
- adjustments (subtractions). Capital Gainz does not handle this
- specific case, so I suggest recording the full interest payment, then
- recording the accrued interest payment as a FEE in the Distribution
- Form. When you generate the tax forms, a separate fee report is
- included to remind you of tax-related fees.
-
- 5.4 Portfolios
-
-
- 5.4.1 "I was maintaining multiple portfolios in different DOS
- directories. How do I use the multiple portfolio feature with my
- scattered data files?"
-
- Use the Capital Gainz Utility program to upgrade the data files in
- each of your directories, if it was not done during installation.
- Then, change to the directory where you want to consolidate all of
- your portfolios. Use the Capital Gainz Utility program to copy or move
- the scattered portfolios into the current directory. Portfolios moved
- from another location will automatically be renumbered so as not to
- conflict with existing portfolios.
-
- 5.4.2 "Why doesn't the portfolio name appear on forms and reports?"
-
- The current portfolio name is only shown if you have more than one
- portfolio.
-
- 5.5 Securities
-
-
- 5.5.1 "What is the difference between Local and Global securities?"
-
- Local securities are securities in a particular portfolio, and have
- associated buy, sell, and distribution activity. Global securities
- contain information about a particular security, such as name and
- type, have price histories, but do not have any activity associated
- with them. You link local securities to global securities by relating
- the local security symbol to the global security symbol. Deleting a
- local security does not affect the related global security. The global
- security's price history remains intact.
-
- You can think of local securities as instances of a global security in
-
- Capital Gainz Users Manual 5-15
-
-
-
-
- a particular portfolio. You can associate global securities with many
- local securities, since a particular security can be held in more than
- one portfolio. However, you can only associate a local security with a
- single global security.
-
- You may want to link multiple local securities within a single
- portfolio to the same global security. This lets you own shares of a
- mutual fund in a regular account, and shares of the same mutual fund
- in an IRA account, both in the same portfolio. The mutual fund
- information and price history are centrally maintained with the global
- security. In fact, you can track a security's price history without
- ever actually adding it to a portfolio.
-
- 5.5.2 "Stock XYZ split 1.25 for 1, but Capital Gainz only accepts a
- single decimal precision in the stock split form. What should I do?"
-
- Simply record the split as 12.5 for 10 (or 2.5 for 2), which is
- identical to 1.25 for 1. Capital Gainz accepts split ratios from 0.1
- to 999.9.
-
- 5.5.3 "What should I do with Local Securities that have been closed
- out?"
-
- When you sell all of the shares from a local security, you should keep
- the security around until after all sales have been used in the tax
- forms. Then, you have two options. First, you can simply delete the
- security, which will remove it along with all associated activity
- logs. Deleting a local security does not delete the associated global
- security and price history - if you want to remove these, you'll need
- to delete the global security as well. However, a better approach is
- to create a new portfolio to use for closed out securities. Use the
- Utility Program to move the inactive local securities to the new
- portfolio. This way, you can always go back and review prior
- performance. To save disk space, the Capital Gainz Utility Program
- will let you put this new portfolio on a floppy disk.
-
- 5.5.4 "Why isn't the load percentage associated with a security?"
-
- A future release will modify the local security file format to include
- loads.
-
- 5.6 Brokers/Investment Companies
-
-
- 5.6.1 "Can I own the same local security through multiple
- Broker/Investment Companies?"
-
- Strictly speaking, you can't do this (but you can achieve an
- equivalent result). The broker/investment company information is
- simply a way to associate holdings with a particular broker or mutual
- fund company. You can associate a broker/investment company with a
- global security and with a local security.
-
- 5-16 Capital Gainz Users Manual
-
-
-
-
- For stocks, you can set the global security's broker/investment
- company to some commonly used 'default' broker. Then, you would use
- a specific broker with the associated local securities.
-
- For mutual funds, you should specify the mutual fund company as the
- broker/investment company for the global security. For the local
- security, you can use the same broker/investment company, or use
- the broker name if you purchased the shares through a broker.
-
- You can achieve the same result as owning the same local security
- through multiple broker/investment companies. If you want this within
- a single portfolio, then define two different local securities and
- link them to the same global security. Or, you can use the same local
- security symbol in different portfolios, both linked to the same
- global security.
-
- 5.6.2 "Why do I have to enter a broker/investment company for each
- local and global security?"
-
- Some users want to leave this blank, but this conflicts with Capital
- Gainz' philosophy of bringing up lookup tables when you leave a field
- blank. The alternative is to define a dummy blank broker, for instance
- NONE, to use when you don't want to enter the broker/investment
- company information.
-
- 5.7 Prices, Distributions Per Share
-
-
- 5.7.1 "When I change a price in the Price History Table, how come the
- prices in the related local securities' activity files are not
- updated?"
- "How come when I change the price for a local security, the price
- history table reflects the change but related local securities'
- activity files are not updated?"
-
- ===>>> Think of the Price History Table as a repository of
- information: activity entries put information in, and sometimes change
- information, but information in the table does not get applied back to
- the activity records. Here's some arguments supporting this approach:
-
- Say you purchase shares of a stock at $10 at the beginning of the
- trading day, which happens to be the last day of the month. If the
- price goes up to $11 by the end of the day, and you update prices
- at the end of the month, you don't want the recorded purchase price
- changed.
-
- Say you purchase shares of stock held in two different portfolios.
- The purchases are on the same day, but at different times and for
- different prices. The entry of the second purchase replaces the
- first entry's price history record. This new price should not be
- used for the first purchase.
-
-
- Capital Gainz Users Manual 5-17
-
-
-
-
- In essence, propagating changes in the price history back to the
- activity records makes sense in many cases. However, there are far too
- many common exceptions.
-
- 5.7.2 "When I change a distribution per share amount in the Price
- History Table, how come the distribution per share amounts in the
- related local securities' distribution files are not updated?"
- "How come when I change the distribution per share amount for a local
- security, the price history table reflects the change but related
- local securities' distribution files are not updated?"
-
- ===>>> The answer to the previous question about prices in the Price
- History File applies here. For example:
-
- Say you delete a distribution per share record from the price
- history. Should the distribution records on this date also be
- deleted? Should their per share value be set to 0? Granted, a
- strong case can be made for propagating changes in distribution per
- share records in the Price History File back to the distribution
- records. However, treating prices and distributions differently
- would result in far more confusion.
-
- 5.7.3 "I've messed around with the price history. How can I
- resynchronize it with my activity?"
-
- Use the Utility Program to rebuild the Price History File from your
- activity files.
-
- 5.7.4 "Is there a way to create an example file for price updates?"
-
- When you update prices from the Global Security Table or the Local
- Security Table, there is a function key option, Generate Skeleton
- File, that creates a skeleton price file. Capital Gainz will write a
- list of your global securities to the filename you request. When you
- exit Capital Gainz, you can edit this file to include updated price
- and date information. This eliminates trial-and-error, and also
- provides a ready list of security symbols.
-
- 5.7.5 "I own two bonds with different maturities. Why are the two
- price histories combined?"
-
- You have both local security bond holdings linked to the same global
- security. The global security defines the bond, and the price history
- is linked to the global security. Because of the maturities, these two
- bonds are different, and the two local securities should be linked to
- distinct global securities.
-
- 5.8 Reports
-
-
-
-
-
- 5-18 Capital Gainz Users Manual
-
-
-
-
- 5.8.1 "What are these funny 'D' and 'M' characters printed on my
- reports?"
- "Why are there no lines separating sections of my reports?"
-
- ===>>> By default, Capital Gainz uses the extended ASCII line drawing
- characters for borders and separators in printed reports. Most
- printers can print these characters, but sometimes you have to flip a
- dip switch on your dot matrix printer or load the appropriate font for
- your laser printer. If you don't want to bother with this, go to the
- User Settings Form and select NO for the Line Draw Chars field. This
- substitutes the - and = characters for the similar line drawing
- characters.
-
- 5.8.2 "How can I cut down the amount of paper used in reports?"
-
- There are two ways to generate shorter reports, saving paper. They are
- both available from the User Settings Form, using the Set Report
- Parameters function:
-
- Set Lines Per Page to 0. This causes the header to only be printed
- once, and no page breaks are added. Essentially, you have an
- infinite length page.
-
- Set Brief Formats to YES. This causes some information to be
- omitted from several reports, resulting in shorter output. The
- Activity Detail Reports, for instance, only print a single line per
- record, instead of 2-3 lines per record.
-
- 5.9 Calculations
-
-
- 5.9.1 "Why doesn't the Gain/Loss figure for Mutual Fund XYZ in the
- Local Security Table include shares purchased with distributions
- (since these were 'given' to me)?"
-
- ===>>> The Local Security Table shows the current gain or loss of all
- shares that you've purchased, to help you determine whether you should
- sell any. Even though distributions such as dividends are 'given' to
- you, you reinvested them in more shares of the mutual fund. If you use
- the Activity Summary function, you'll see a calculation that combines
- all of your buy, sell, and distribution activity to come up with your
- overall performance figure. Calculating total distributions in the
- Local Security Table would significantly hamper performance, and also
- may adversely affect your selling decisions.
-
- 5.9.2 "What's the distinction between realized and unrealized
- gains/losses?"
-
- The Open Shares Log represents unrealized gains and losses, while the
- Closed Shares Log represents realized gains and losses. This means
- that the gains and losses shown in the Open Shares Log can change
- based on other changes, such as updating the price of the security.
-
- Capital Gainz Users Manual 5-19
-
-
-
-
- The gains and losses shown in the Closed Shares Log only change if you
- explicitly change the closed shares records.
-
- 5.9.3 "Why does one of my securities show a loss greater than 100%?"
-
- By default, Capital Gainz does NOT include commissions in the basis,
- but does factor them into the gain/loss calculation. The net result is
- that there is a slight difference in the percentage calculations than
- if you included the commissions in the basis. The reasoning here is
- that the commission amount is never actually invested in shares. If
- you would rather include the commission in the basis, answer YES to
- the Include Commission in Basis field on the User Settings Form.
- Changing this field has no permanent effect, so you can try it both
- ways.
-
- For example, say you purchased 100 shares at $10 each, paid a $40
- commission, and the security is now worth $11. Your gain is:
- (100 * $11) - (100 * $10) - $40 = $60
- Not including commissions in the basis, the percentage gain is:
- $60/(100 * $10) = 6.00%
- Including commissions in the basis, the percentage gain is:
- $60/((100 * $10) + $40) = 5.77%
-
- 5.9.4 "Why is Mutual Fund XYZ's yield so high (or all '*'s)?"
-
- ===>>> You either entered the amount of the dividend for the
- Dividends/Year field in the Global Security Form, or entered a price
- for the Per Share field in the Distribution Form. The dividends/year
- figure should indicate the number of times a year the company pays
- dividends, such as 4 for quarterly payouts. The per share value should
- indicate the per share amount of the distribution, not the
- reinvestment price, and is normally listed on your statements.
-
- 5.9.5 "I've only recorded activity for a short time and the return
- percentages look correct, but the rate calculations appear way too
- low."
-
- There is probably an incorrect, 'stray' entry in the Price History
- File. For instance, say you added a price for 1/01/01 instead of
- 1/01/91. Calculating return percentages for all dates would include
- the 1/01/01 entry, skewing the rate by 90 extra years. To fix this,
- check the Price History Table.
-
- 5.9.6 "What's the difference between the Total Return and Performance
- figures in the Activity Summary Report?"
-
- ===>>> Total return uses the price history of a security to show the
- return over the period. In essence, this simulates a 'buy-and-hold'
- strategy, where one share is purchased at the beginning of the period,
- held to the end of the period, and distributions are reinvested. Your
- performance is calculated based on purchases, sales, and distributions
- recorded in the activity logs.
-
- 5-20 Capital Gainz Users Manual
-
-
-
-
- 5.9.7 "What do the variations between Total Return and Performance
- mean?"
-
- If your actual performance was under par, but the total return is
- good, then you've adversely affected your performance through poor
- timing. The security is a good-performer, and should probably be held.
- This effect is common for dollar-cost averaging strategy employed over
- a short period in a rising market.
-
- If your performance was good, but the total return is under par, then
- you've managed to increase returns through good market-timing. While a
- 'buy-and-hold' strategy would not have done well, the market-timing
- effects of your purchases and sales made this security a winner. This
- effect is common for dollar-cost averaging strategy employed over a
- long period in a fluctuating market.
-
- 5.9.8 "What figure is more important, Total Return or Performance?"
-
- They are both important, but total return is probably the most
- revealing of the two figures. It clearly shows whether a security has
- performed well or not. Poor attempts at market timing may result in
- low values for Performance, regardless of the security's performance.
- Or, successful market timing can cover up a security's poor
- performance.
-
- 5.9.9 "What is the 'rate' figure?"
-
- A fairly complex calculation is used to determine the simple, yearly
- rate of return, assuming annual compounding. This figure can be
- misleading, because a 10% return for one month doesn't mean you should
- expect 120% per year.
-
- 5.9.10 "How are purchases on different dates factored into the
- calculated return for Performance?"
-
- Accounting for time differences is difficult, and every approach has
- flaws. The method used involves annualizing purchases that cover
- partial periods. For instance, say two purchases were made over a
- year, one at the beginning of the year for $1000 and one at the end of
- the year for $500. If the return on the security was $100, then the
- calculated return is:
- (100/(1000 + 500 - 500 * 1/2)) * 100 = 8.00%
- Since the second purchase was not held for the first half of the
- period, it's adjusted by subtracting out half of the purchase amount.
-
- 5.9.11 "Why does the yield calculation only use the last dividend?"
-
- Yield is really a measure of expected return. That's why Capital Gainz
- takes the last dividend/interest distribution per share and multiplies
- it by the number of expected dividend/interest payouts. An alternative
- is to sum all dividend/interest distributions over the last year.
- There are three problems with doing this:
-
- Capital Gainz Users Manual 5-21
-
-
-
-
- 1) 'Missing' distributions would have to be estimated.
- 2) If a security increases its dividend, then the yield would not be
- correct.
- 3) Performance would be hampered.
-
- 5.9.12 "I have a stock that quit paying dividends. How do I show no
- yield?"
-
- Set the Dividends/Year field in the Global Security Form to 0.
-
- 5.9.13 "Why doesn't Capital Gainz automatically set the yield to zero
- if no dividends have been recorded for some time?"
-
- At first glance, it makes sense to ignore dividends over one year old,
- so that the yield will drop to zero if the security quits paying
- dividends. However, if you sell all the shares of a security, it's
- nice to be able to see the yield, even though you don't own it. If you
- want to reduce the yield to zero, set the Dividends/Year field in the
- Global Security Form to 0.
-
- 5.10 Tax Forms
-
-
- 5.10.1 "I have a local security with distributions and sales, but it
- doesn't show up on Schedule D."
-
- The local security was defined as tax-exempt, which means it's treated
- like an IRA. To change it, highlight the security in the Local
- Security Table, hit Enter, then change the tax exempt field to NO.
-
- 5.10.2 "What does Capital Gainz do with long and short term capital
- gains distributions on Schedule B?"
-
- The IRS publications are ambiguous on this point. Some statements
- indicate that capital gains distributions from mutual funds should
- always be classified as long term. However, other statements can be
- interpreted as meaning short term capital gains should be lumped
- together with dividends. This means that short term capital gains
- should stay on Schedule B, while long term capital gains are
- subtracted back out.
-
- A valid argument exists for both approaches. Based on several mutual
- fund statements, Capital Gainz treats all short capital gains
- distributions like dividends. However, you can modify one or more
- security types to treat short term capital gains distributions like
- long term capital gains. The default approach sets the STCG (short
- term capital gains) handling of a security type as B SCH, meaning they
- stay on Schedule B. You can change this to D<-B, meaning they flow to
- Schedule D from Schedule B.
-
-
-
-
- 5-22 Capital Gainz Users Manual
-
-
-
-
- 5.10.3 "I changed the Long Term Holding Period in the User Settings,
- but the Schedule D report doesn't reflect the new value. What's
- wrong?"
-
- ===>>> The long term holding period is applied to sales at the time of
- the sale only. This allows prior sales to remain correct in spite of
- changes in the holding period. For instance, several years ago the
- holding period changed from 6 months to 1 year. By determining
- long/short term status at the time of the sale, prior years' Schedule
- D forms will always be accessible.
-
- You can apply the new holding period to one or more sold shares
- records without unselling/reselling the shares. You can highlight the
- record on the Closed Shares Log, hit Enter to change it, then set the
- status field to STERM (short term) or LTERM (long term). You can also
- change a range of sold shares records. Select Date Range on the Log
- Maintenance Menu, enter the first and last selling dates of the sold
- shares records that you want to change, bring up the Closed Shares
- Log, and execute the function Apply Holding Period. Each of the closed
- shares record's open and close dates are compared to the holding
- period, and the long/short term status is set accordingly.
-
- 5.10.4 "What does 'Group Sales' mean on Schedule D?"
-
- ===>>> The group sales option lets you group all purchases for a given
- sale, resulting in a single short term transaction, long term
- transaction, or one of each. If you've been buying shares of a mutual
- fund monthly and then close the fund by selling all of the shares,
- grouping sales makes the Schedule D report much shorter and easier to
- read and transfer to your actual tax forms, since each individual
- purchase is not shown. The purchase date shown for grouped sales is
- VARIOUS. Essentially, a grouped sale is analogous to the sales
- subtotals in the Closed Shares Detail Report.
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- You can group sales of individual security types by modifying the
- types in the Security Type Table, or group all types by setting Group
- Sales to YES on the form displayed after selecting the tax forms
- report.
-
- 5.10.5 "Group sales make Schedule D simpler, but are they IRS
- approved?"
-
- I have used them before, as have several accountants I've talked to.
- The end result is certainly identical to listing each purchase.
- However, no IRS publication states whether or not they are acceptable.
-
- 5.10.6 "I've used the check writing feature of a money market mutual
- fund. Now I've got a whole lot of Schedule D entries, with 0 gain -
- should these all be reported?"
-
- Technically, all sales of mutual funds must be reported on Schedule D.
- You have two options to make things easier. First, you can use the
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- Capital Gainz Users Manual 5-23
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- Group Sales option, so you only have a single transaction for each
- check. Alternatively, you can change the global security's type, or
- define a new one, to OMIT sales from Schedule D. Neither approach is
- defined as acceptable or unacceptable in any IRS publication.
-
- 5.10.7 "How do I change a security so that the dividends or interest
- are listed as tax free on Schedule B?"
-
- To define a security as distributing tax-free dividends/interest,
- select a tax-free security type for the associated global security.
- Tax-free security types have the phrase 'tax-free' in their names.
- However, you can change the tax-free status of a security type, or
- define a new security type that is tax-free.
-
- 5.10.8 "I have an international fund that pays a foreign tax, as
- reported on my year-end 1099 form. How do I record this to make
- Schedule B correct?"
-
- Foreign taxes are paid out of distributions, but the fund companies
- don't report them until the end of the year. This affects the
- distributions/share, and thus the yield of a fund - but only slightly.
- The suggested way to handle this is:
- 1) Record the Foreign Tax as a dividend on the last day of the year,
- without reinvesting the distribution.
- 2) Record the Foreign Tax as a fee on the last day of the year,
- without selling shares to cover the fee. This way, the distributions
- will match up.
- Capital Gainz prints out a list of any recorded fees after Schedule B,
- with a comment to the effect that they may be tax deductible.
-
- 5.10.9 "What's the difference between a local security defined as Tax
- Exempt and a local security whose linked global security uses a tax-
- free security type?"
-
- ===>>> A Tax Exempt local security is treated like an IRA, so no
- distributions or sales are reported on Schedule B or Schedule D. A
- tax-free security type indicates that dividends or interest are non-
- taxable on Schedule B. Sales are reported as usual on Schedule D.
-
- 5.11 Execution Speed
-
-
- 5.11.1 "What's the best way to speed up execution without getting a
- faster machine or disk drive?"
-
- Probably the best way to increase the overall performance of Capital
- Gainz without new hardware is to use a disk cache. SMARTDRV.SYS, which
- comes with Windows, does an admirable job. To speed up reports,
- backups, and shelling to DOS, use a RAM drive for temporary files. See
- Chapter 23 for details.
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- 5.12 Consistency Check
-
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- 5.12.1 "Why doesn't Capital Gainz check for duplicate symbol/date
- pairs in Buy/Sell/Distribution records?"
-
- Multiple purchases of a security on a single date are common for
- dividend reinvestment plans. Dividends and additional cash are
- reinvested on the same day at the same price. In any case, incorrect
- multiple entries should be easily spotted by comparing totals to the
- totals on your mutual fund or broker statements.
-
- 5.13 Utility Program
-
-
- 5.13.1 "Why can't I start the Utility Program from Capital Gainz?"
-
- In order to invoke the Utility Program from Capital Gainz, two things
- are necessary. First, Capital Gainz must have been started by CG.BAT.
- Second, the Utility Program, CGUTIL.EXE, must be in the same directory
- as Capital Gainz.
-
- 5.13.2 "Why does the Utility Program keep failing with 'Invalid
- Record Declaration'?"
-
- Except when upgrading, the version number of the Utility Program must
- match the version of Capital Gainz used to create the data files. The
- upgrade process transforms data files created with an older version of
- Capital Gainz into a format usable by the current version of Capital
- Gainz. When you upgrade data files, you must correctly specify the
- version number of Capital Gainz used to create the data files you are
- converting from.
-
- 5.14 Graphics Program
-
-
- 5.14.1 "Why can't I start the Graphics Program from Capital Gainz?"
-
- To invoke the Graphics Program from Capital Gainz, two things are
- necessary. First, Capital Gainz must have been started by CG.BAT.
- Second, the Graphics Program, CGGRAPH.EXE, must be in the same
- directory as Capital Gainz.
-
- 5.14.2 "Why doesn't the Graphics Program display a status line when
- printing, like Capital Gainz does?"
-
- The Graphics Program prints the entire screen. Thus, the status line
- is blanked out, then redisplayed after output is complete.
-
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- 5.14.3 "I've moved a lot of cash to a money market account. Why are
- other securities' bars so small that the cost/value difference is
- obscurred?"
-
- Since the Graphics Program automatically scales data based on the
- largest value, the large money market holding is adversely affecting
- other securities. Money market securities maintain a constant price,
- so their cost and value bars will always be equivalent. You should
- specify NO to the Include Cash? field in the Graphics User Settings,
- removing cash equivalent securities from the graph.
-
- 5.14.4 "Can I get rid of all these lines cluttering up the Price
- Graph?"
-
- The average, standard deviation, and best-fit lines are displayed by
- default. You can choose not to print these by setting their color to
- NO COLOR in the Graphics User Settings. Similarly, you can turn off
- the grid.
-
- 5.14.5 "Can I generate PCX files to use with other programs?"
-
- Yes. Normally, when you print to a file, output is in the format of
- your selected printer. However, if you specify a filename with a .PCX
- extension, it will be printed in PCX format.
-
- 5.14.6 "I'm trying to set up my HP Laserjet, but the printer setup
- form displayed is for a dot matrix printer. How can I get the
- appropriate form?"
-
- The setup form is specific to the printer you select in the User
- Settings Form. Enter a blank or invalid value in the Printer field to
- bring up the list of printer types to choose from. Select PCL
- Laserjet. Back at the User Settings Form, hit the Setup Printer key to
- bring up the form to setup a PCL Laserjet printer.
-
- 5.14.7 "Why does the Graphics Program keep failing with 'Invalid
- Record Declaration'?"
-
- The version number of the Graphics Program must match the version of
- Capital Gainz used to create the data files.
-
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