- quote -

Actually you should ONLY do one transaction... "Reinvest
the Dividend"

If you do a seperate transaction for the incoming dividend
then you should do a "Buy" with the money.

Same with Cap Gains.

Hope this helps

-Kevin



<johnmohlengraft[at]gmail.com> wrote in message
news:1166822985.618652.304370[at]48g2000cwx.googlegroups.com...
- quote -

Several issues here.

1) There are Activities, Reinvest Dividend and Reinvest T-Term CG, that
combine what you are doing into one transactions.

2) Cost Basis for a 401k is a pretty worthless thing to worry about in
general. (Non-Roth 401k comments follow.) Everything but After Tax
contributions, if any, will all get treated as Earned Income when you take
it out. Whether it got there from deferred earnings or employer contribution
or reinvested dividends or capital gains of any kind, it all gets washed to
Earned Income when you get it in your hot little hands. Besides, your
trustee will keep all the records and dutifully report them to the IRS for
you.

Given the tremendous breaks afforded over the last ten years or so to rich
people who invest not work, the 401ks, of people who work, not just invest,
kinda get stiffed. This is a prime reason to consider the advisability of
after-tax 401k and IRA investments vs. just plain old taxable investing.

At any rate, say it were a taxable account, rather than a tax deferred one.
The Reinvest Dividends and Reinvest L-Term CG all count toward basis. Just
like the Dividends and Cap Gains are taxable in the here and now.

<johnmohlengraft[at]gmail.com> wrote in message
news:1166822985.618652.304370[at]48g2000cwx.googlegroups.com...
- quote -

In microsoft.public.money, johnmohlengraft[at]gmail.com wrote:

- quote -

No.

- quote -

The cost basis, is for the security. Suppose you were to not
reinvest the distribution in the same security, but instead bought
something else with the distribution, you would not expect the basis
of the shares you already had to decline would you? So if you then
by more with the distribution, then the basis would increase.

If you want to know how the *account* is doing, I suggest you look
at the gain and TR figures for the account in the TotalAccount row
in bold.

MS Money 2002

When my Dividends come in every month and are reinvested into the
Mutual fund that it came from, I go to my 401k page, then to the
Investment Transactions, I do one transaction for the incoming
Divindend, then another to show that I'm reinvesting.

I think the effect is that the dividend is going into the cost basis
which is incorrect right? The Cost Basis should only be what I have
put into the 401k. Same thing goes for the Cap Gains that were added
into my account this month.