Let’s suppose you buy an asset expected to increase in value, say a Degas painting, and want to track this. (The insurance company will care about this, even if nobody else does.)
Start with an account hierarchy similar to that shown in Раздел 11.3, «Account Setup», but replace «ITEM1» with «Degas» and you can remove the «ITEM2» accounts. We will assume that the Degas painting had an initial value of one hundred thousand dollars. Begin by giving your self $100,000 in the bank and then transferring that from your bank account to your Assets:Fixed Assets:Degas:Cost account (the asset purchase transaction). You should now have a main account window which appears like this:
A month later, you have reason to suspect that the value of your painting has increased by $10,000 (an unrealized gain). In order to record this you transfer $10,000 from your Accrued Gains income account (Income:Unrealized Gains) to your asset Unrealized Gains account (Assets:Fixed Assets:Degas:Unrealized Gain). Your main window will resemble this:
Let’s suppose another month later prices for Degas paintings have gone up some more, in this case about $20,000, you estimate. You duly record the $20,000 as an unrealized income like above, then decide to sell the painting.
Three possibilities arise. You may have accurately estimated the unrealized gain, overestimated the unrealized gain, or underestimated the unrealized gain.
Accurate estimation of unrealized gain.
Your optimistic estimate of the painting’s value was correct. First you must record that the profits made are now realized gains, not unrealized gains. Do this by transferring the income from the Income:Unrealized Gains to the Income:Realized Gains account.
Secondly, you must credit your bank account with the selling price of the painting. This money comes directly from your Assets:Fixed Assets:Degas sub-accounts. Transfer the full Assets:Fixed Assets:Degas:Cost value into Assets:Current Assets:Savings Account, and the full Assets:Fixed Assets:Degas:Unrealized Gain into Assets:Current Assets:Savings Account.
These transactions should now appear as follows:
Таблица 11.1. Turning an Accrued Gain into a Realized Gain
Account Transfer to Transaction Amount Account Total Income:Unrealized Gains Income:Realized Gains $30,000 $0 Assets:Fixed Assets:Degas:Cost Assets:Current Assets:Savings Account $100,000 $0 Assets:Fixed Assets:Degas:Unrealized Gains Assets:Current Assets:Savings Account $30,000 $0
This leaves the Assets:Current Assets:Savings Account account with a total of $130000 and Income:Realized Gains with a total of $30000.
Over estimation of unrealized gain.
You were over-optimistic about the value of the painting. Instead of the $130000 you thought the painting was worth you are only offered $120000. But you still decide to sell, because you value $120000 more than you value the painting. The numbers change a little bit, but not too dramatically.
The transactions should now appear as follows (observe the last transaction which balances the Unrealized Gains accounts):
Таблица 11.2. Turning an Accrued Gain into a Realized Gain
Account Transfer to Transaction Amount Account Total Income:Unrealized Gains Income:Realized Gains $20,000 $10,000 Assets:Fixed Assets:Degas:Cost Assets:Current Assets:Savings Account $100,000 $0 Assets:Fixed Assets:Degas:Unrealized Gains Assets:Current Assets:Savings Account $20,000 $10,000 Assets:Fixed Assets:Degas:Unrealized Gains Income:Unrealized Gains $10,000 $0
This leaves the Assets:Current Assets:Savings Account account with a total of $120000 and Income:Realized Gains with a total of $20000.
Under estimation of unrealized gain.
You manage to sell your painting for more than you thought in your wildest dreams ($150,000). The extra value is, again, recorded as a gain, i.e. an income.
The transactions should now appear as follows (observe the last transaction which balances the Unrealized Gains accounts):
Таблица 11.3. Turning an Accrued Gain into a Realized Gain
Account Transfer to Transaction Amount Account Total Income:Unrealized Gains Income:Realized Gains $50,000 $-20,000 Assets:Fixed Assets:Degas:Cost Assets:Current Assets:Savings Account $100,000 $0 Assets:Fixed Assets:Degas:Unrealized Gains Assets:Current Assets:Savings Account $50,000 $-20,000 Income:Unrealized Gains Assets:Fixed Assets:Degas:Unrealized Gains $20,000 $0
This leaves the Assets:Current Assets:Savings Account account with a total of $150,000 and Income:Realized Gains with a total of $50,000.
