I need your help. I am not sure how cost-bases and dividends work.
For example, I received $83.34 in dividends for the month of December. Here
I used those dividends and reinvested it in KMI Here
Now here is my question.
I had 57 shares of KMI. Like so:
Notice the "Costbasis", "Basis", "Total Value" and "YOC" column.
Now I used the dividend received in December and brought 1 more share of KMI. Now I have 58 shares of KMI.
Since I only change the shares from 57 to 58. The only things that gets change are "Basis", "Total Value", "% Ch.","Weight","Annual Income" and "YOC" column.
My question to you guys is do I add the dividends I used to the "costbasis" column, or should I just change the shares column since I am using dividends to buy shares.
Here is what I think.
I think I should just change the shares amount because I am using money, dividends, that I did not have to buy more shares. The only time I change the "costbasis" column is when I use my own money that I received from work or other means beside dividends.
Please let me know what is the right way and why. Also please let me know if I need to clarify.