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Fools,

Several of you have asked questions about how to handle dividends in MyScorecard. I've answered a few of these directly but I thought it might be helpful to do a "solo post" on the subject...

Unfortunately, MyScorecard doesn't have a built-in way to handle dividends. The best way to do this depends on your situation.

1) If you're taking the DIVIDEND IN CASH and...

A)...you're tracking cash in My Scorecard (more on that here: http://boards.fool.com/simulating-a-cash-position-in-myscore...) then you'll just want to adjust your cash position to account for the new cash in your account as a result of the dividend.

B)...you're NOT tracking cash in My Scorecard, then you'll want to adjust the cost basis of your position. Here's an example of how to do this:

Let's say you've purchased 1,000 shares of Stock Z for \$20,000. The purchase price you would use for this position would be \$20,000 / 1,000 shares = \$20.00/share. At a later date, Stock Z pays a \$0.50 dividend per share, for a total of \$500. To account for this, you would lower your original cost basis and then recalculate your per share price. So (\$20,000 - \$500 = \$19,500) / 1,000 shares = \$19.50 per share. Your cash dividend is now accounted for.

2) If you're REINVESTING THE DIVIDEND or the DIVIDEND IS IN STOCK, you'll need to do 2 things:

2A) Add a new entry in My Scorecard for the dividend based on the dividend's issue price and share volume AND

2B) Adjust a previous entry's cost basis

To use an example again: Let's say you've purchased 1,000 shares of Stock Z for \$20,000. The purchase price you would use for this position would be \$20,000 / 1,000 shares = \$20.00/share. At a later date, Stock Z pays a dividend of .02 shares per share at a price of \$25.00/share. The benefit to you in this situation is \$500: 1,000 original shares * .02 shares per share * \$25.00 per share = \$500. First, add a new line to MyScorecard for your new position. Stock Z, 20 shares, \$25.00 per share on the date of issue. Next, you would lower your original cost basis and then recalculate your per share price as in the previous example. So (\$20,000 - \$500 = \$19,500) / 1,000 shares = \$19.50 per share. Your stock dividend is now accounted for.

Sorry it's complicated. Reply to this post if you have questions.

Fool on,
Mark
TMFKnightly