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How do I record a sale of an asset?

what is the entry in quickbooks for the sale of an asset?

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Best answer 10-15-2018

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create an income account called gain/loss on asset sales...

create an income account called gain/loss on asset sales

then it depends, if the asset is subject to depreciation, you calculate and post partial year depreciation
then journal entries (*** means use the total amount in this account)

debit asset accumulated depreciation***, credit gain/loss
debit gain/loss, credit asset account***

deposit the check received for the sale, and use the gain/loss account as the source (from) account for the deposit

If the asset is subject to depreciation for fed taxes, and you did not claim depreciation expense, you need a tax accountant, the IRS says that whether you claimed depreciation expense or not, you have to figure gain/loss as if you did claim it.

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Highlighted
Established Community Backer ***

create an income account called gain/loss on asset sales...

create an income account called gain/loss on asset sales

then it depends, if the asset is subject to depreciation, you calculate and post partial year depreciation
then journal entries (*** means use the total amount in this account)

debit asset accumulated depreciation***, credit gain/loss
debit gain/loss, credit asset account***

deposit the check received for the sale, and use the gain/loss account as the source (from) account for the deposit

If the asset is subject to depreciation for fed taxes, and you did not claim depreciation expense, you need a tax accountant, the IRS says that whether you claimed depreciation expense or not, you have to figure gain/loss as if you did claim it.

View solution in original post

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QB Recording of Asset Sale.

I added  debited "Farm Land OK" Asset Account on 9/2/16 for ~$75,000 and Debited "Loans from Shareholder" liability account, for farms I inherited and transferred to my C-Corporation.

I sold this land 9/4/2018 for $260,000, but deposited check for ~$250,000 due to Sales costs.

Should I enter both full sale and sales costs as General Journal Entries or only show check received?  I think I should Credit "Farm Land Account" for inquisition cost and also Credit Loans from Shareholders? How to make Gen-Journal entry for net gain of ~$175,000 ?  Also, how can QB best show repayments to myself against liability account"Loans from Shareholders"? Thanks for your help!

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Re: create an income account called gain/loss on asset sales...

this nicely shows why our tax code is a cluster!

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