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Level 1

Hello. Need help with journal entry for sale of vehicle.

Original Loan Amt of $10,000.

Sold to dealer for $8000.

Paid loss of $2000 with new vehicle loan.

New car purchase of $20,000

Total new car loan of $22,000.

 

Thank you!

1 Comment
Highlighted
Level 15

Hello. Need help with journal entry for sale of vehicle.

The vehicle should have been carried as a fixed asset, something like this
fixed assets:
car model
>> car cost
>> accum. depreciation car

 

1. calculate and post partial year depreciation on the car
2. create create a new car fixed asset car structure like the above
3. journal entries

debit accum. depreciation car for the balance in the account, credit new car cost account
debit new car cost account, credit car cost fixed asset account for the balance in the account

then

debit old loan 10K
debit new car cost 12K
credit new loan 22K

 

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