KRB merged with BAC, on 01/03/2006. Not only did
shareholders get 0.5009 for every share of KRB, they also
received $4.125 in cash for each share held as well.

My question is this: How do I enter the CASH received in
BIVIO?

Do I discount the principle investment into KRB?

Example: $716.50 invested into KRB. Received $131.71 from
merger payout. $584.79 invested into BAC?

If so, how do I enter it? If not, how do I enter it>?

Thanks,
Chris

Chris,

Here is a copy of a post I made to the BI Treasurers' list on the
subject.........

This is one of those mergers plus cash deals that are becoming so
popular with Wall Street and such a headache to poor suffering
investment club treasurers<g>. Basically, what you do is this. First
figure out the total consideration on the transaction by adding the cash
received to the market value of the BAC shares received. To get the
total gain, you would deduct the cost of your KRB shares from that
consideration. If you have a gain, it is taxable, but the gain is
limited to the amount of the cash received. You would enter the
**recognized** gain as a capital gain distribution, either long-term or
short term, depending on the holding period for KRB. You would enter any
excess of cash received over the recognized gain as a return of capital
distribution. You would enter the exchange of KRB shares for BAC as a
merger. In recording the merger, include the fractional shares received,
and also enter the cash received in lieu of fractional shares.

If it turns out that you had a loss instead of gain on the total
transaction, you enter the cash received as a return of capital and then
record the merger.

It is important to remember that you have to do all the above for each
block of KRB stock owned. I would wait until you get some notice from
KRB as to the opening market value of the BAC shares before you record
the above.

Rip West
Saint Paul, MN


Rip West
Saint Paul, MN

----- Original Message -----
From: "Christopher Biegel" <biegelboy@bivio.com>
To: <club_cafe@bivio.com>
Sent: Wednesday, January 04, 2006 2:52 PM
Subject: club_cafe: MBNA Merger Transaction: Question?


KRB merged with BAC, on 01/03/2006. Not only did
shareholders get 0.5009 for every share of KRB, they also
received $4.125 in cash for each share held as well.

My question is this: How do I enter the CASH received in
BIVIO?

Do I discount the principle investment into KRB?

Example: $716.50 invested into KRB. Received $131.71 from
merger payout. $584.79 invested into BAC?

If so, how do I enter it? If not, how do I enter it>?

Thanks,
Chris

Rip West writes:
> This is one of those mergers plus cash deals that are becoming so
> popular with Wall Street and such a headache to poor suffering
> investment club treasurers<g>.

Not for treasurers who use AccountSync(tm)! The transaction is
entered automatically by AccountSync. :-)

Rob

ok?

For those of us who have an BROKERAGE FIRM that do not allow
AccountSync (yet), how do you manually input the
transaction?

Rob Nagler wrote:
> Rip West writes:
> > This is one of those mergers plus cash deals that are becoming so
> > popular with Wall Street and such a headache to poor suffering
> > investment club treasurers<g>.
>
> Not for treasurers who use AccountSync(tm)! The transaction is
> entered automatically by AccountSync. :-)
>
> Rob

Follow the procedure outlined by Rip West a few posts back
to determine how much of the cash is capital gain and/or
return of capital.

Enter the return of capital and/or capital gain distribution
transactions as KRB transactions. Then enter the merger of
KRB into BAC and enter the cash-in-lieu for any fractional
shares of BAC which were sold.

Ira Smilovitz

Christopher Biegel wrote:
> ok?
>
> For those of us who have an BROKERAGE FIRM that do not allow
> AccountSync (yet), how do you manually input the
> transaction?
>
> Rob Nagler wrote:
> > Rip West writes:
> > > This is one of those mergers plus cash deals that are becoming so
> > > popular with Wall Street and such a headache to poor suffering
> > > investment club treasurers<g>.
> >
> > Not for treasurers who use AccountSync(tm)! The transaction is
> > entered automatically by AccountSync. :-)
> >
> > Rob

Hi Chris,

<<
For those of us who have an BROKERAGE FIRM that do not allow AccountSync
(yet), how do you manually input the transaction?
>>

Well, you could switch brokers <g> Otherwise, I did post a fairly
detailed description of what you should do. Was there some part of that
that needs more explanation?

Rip West
Saint Paul, MN

Sorry...I didn't see your posting, when I posting that.

I was commenting on the posting that adviced to get a broker
who allows AccountSync.

But...I do have a few more questions:

(1) Do I enter the CASH RECEIVED as RETURN OF CAPITAL to
KRB prior to doing the MERGER transaction? Or - Do I do the
MERGER transaction first and enter the CASH as RETURN OF
CAPITAL for BAC?

(2) My club purchased KRB stock back in 2002 - we bought
into KRB twice (no to mention reinvested dividends) in 2002
01/28/2002 - 10 shares + 07/15/2002 Stock split 5 shares and
11/14/2002 - 15 shares.

Does this mean the RETURN OF CAPITAL is Long-term? Or
Long-term post May 2003 (one of the many Bivo selections).
If not, what sorta Return of Capital gain is it?

31.93 total shares of KRB = TOTAL Capital Investment
$716.23

Received $131.71 in CASH and 15.994 shares of BAC via
merger.

Please lead me into the light.

Thanks,
(In the dark)
Chris


Rip West wrote:
> Hi Chris,
>
> <<
> For those of us who have an BROKERAGE FIRM that do not allow AccountSync
> (yet), how do you manually input the transaction?
> >>
>
> Well, you could switch brokers <g> Otherwise, I did post a fairly
> detailed description of what you should do. Was there some part of that
> that needs more explanation?
>
> Rip West
> Saint Paul, MN