QuickBooks Pro 2022: Tracking Your Investments

Name: QuickBooks Pro 2022: Tracking Your Investments
Author: Takeisha Strong

Learn the basics of tracking investments and recording investment purchases and sales

Preview the first lesson free — get full access to all 4 lessons.

Course: On-Demand

Hello, my name is Takisha Strong. In these lessons, we will learn how to customize your QuickBooks file to track investments, and how to record investment purchases and sales. Let's get started. There are so many different types of investments, such as wholly-owned subsidiaries, certificates of deposit, mutual funds, real estate investment trusts, stocks, bonds. For the sake of simplicity, these lessons will focus on security-type investments. However, the foundation for customizing the accounts is general in nature and can also be used with subsidiaries, REITs, and other investment types. First, we will learn how to set up the file to record activity periodically, then later in the lesson, we will learn steps we can add to record and track securities individually. We'll be using our sample product-based company, Rock Castle Construction. Let's open the Chart of Accounts tile in the Company portion of our homepage. The first step will be the same for both methods. We can start by adding either a new bank account, which can be used for something like mutual fund activity, or we can add a new current asset account to record different types of investments. For this example, let's choose a new current asset account and name it Investments. Press Control N to create a new account. We'll select Other Account Types, Other Current Asset, and Continue. First, we'll confirm the account type at the top of the page. The account name will be Investments and we'll select Save & New. Now for this next part, we'll choose to create sub-accounts to record the different components within our investment account. Typically, you'll add cash into an investment account to purchase your securities, and then you'll have the securities themselves. We'll first confirm that the account type at the top of the form is Other Current Asset. We'll name our first sub-account Cash to note the cash portion of the investment account. Select Investments for the sub-account, Save & New, and let's call our next sub-account Stocks. Sub-account of Investments, Save & Close. You'll see now we have a new current asset. We have a cash portion of the investment account and a stocks portion of the investment account. Keep in mind QuickBooks does not have the functionality to automatically track individual investment activity at a granular security level. For this example, Rock Castle records changes in market activity periodically. So we can create a contra account for the investment type, similar to tracking fixed assets and corresponding accumulated depreciation. Let's select Control N to create another account. The account type is Other Current Asset. Press Continue. We'll confirm the account type at the top and we'll call this contra account Market Activity. It's gonna be a sub-account of our stocks, Save & Close. So now we'll see we have our investment account, cash portion, the original cost of the stock portion, and any fluctuations in market activity. Each of these steps can be repeated if you'd like to create a long-term asset account. Next, let's create the offsetting accounts for this investment or market activity. For accounting purposes, we don't record the income or loss for periodic market fluctuations on investments that remain in our portfolio. In its most simplest form, those are called unrealized gains and losses, or a paper profit or loss, since it only exists on paper for now. Since they do affect our investment account balances, they also affect the owner's total basis or value of the company. Therefore, we would create an offsetting account named Unrealized Gan or Loss in the Equity section of our balance sheet. Let's scroll down to the Equity section of the chart of accounts. We'll create a new account. The account type is Equity, press Continue. Confirm account type at the top. We'll name this Unrealized Gains and Losses. Press Save & Close.

Intermediate Provider : Takeisha Strong 4 Lessons · 30m in Arabic, German, English, Spanish, French, Portuguese, Chinese

Course Description

Many companies invest a portion of their cash or may be in the business of investment trading. In Tracking Your Investments, users will learn how to manage all investment activity. This includes creating accounts to track investment activity, recording market fluctuations, recording investment purchases, and tracking investment sales.

There are multiple ways investments can be tracked in QuickBooks Pro 2022. Although there are differences in tracking investments in the aggregate and individually, the initial steps within the accounting software are the same. After completing this module, the user will learn to do both, along with how to account for both unrealized and realized gains and losses. Tracking Your Investments will teach the user how to monitor the balance sheet and profit and loss statement to ensure investment activity is tracked correctly. The user will also learn where and what to look for when recording market fluctuations versus actual investments and sales.

What You'll Learn

Set up investment accounts in QuickBooks Pro 2022 to track investment activity
Record investment purchases and market fluctuations correctly
Track investment sales and organize them in QuickBooks
Account for both unrealized and realized gains and losses
Track investments both in the aggregate and individually
Monitor the balance sheet and profit and loss statement to ensure investment activity is tracked correctly

Key Takeaways

Companies may invest a portion of their cash or operate in the business of investment trading, and QuickBooks Pro 2022 can manage all of this investment activity.
There are multiple ways investments can be tracked in QuickBooks Pro 2022, including in the aggregate and individually, though the initial setup steps within the software are the same.
Tracking investments requires recording market fluctuations separately from actual investment purchases and sales.
The course covers accounting for both unrealized and realized gains and losses.
Monitoring the balance sheet and profit and loss statement helps ensure investment activity is tracked correctly.

Frequently Asked Questions

What will I learn in this course?

You will learn how to manage all investment activity in QuickBooks Pro 2022, including creating accounts to track investment activity, recording market fluctuations, recording investment purchases, and tracking investment sales. You will also learn to account for both unrealized and realized gains and losses.

Who is this course for?

It is suited to users at companies that invest a portion of their cash or are in the business of investment trading and need to track investment activity in QuickBooks Pro 2022.

Does the course cover tracking investments individually or in aggregate?

Both. The course teaches tracking investments in the aggregate and individually; although there are differences between the two approaches, the initial steps within the accounting software are the same.

What lessons are included?

The course includes Setting Up Investment Accounts (Part 1), Setting Up Investment Accounts (Part 2), Investment Purchases, and Investment Sales.

How does the course help ensure investments are tracked correctly?

It teaches how to monitor the balance sheet and profit and loss statement, and where and what to look for when recording market fluctuations versus actual investments and sales.