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Join nowWe bought a business vehicle on 9/26/20 for $51,896.09. We used 179 to fully depreciate first year.
On 1/5/22 we sold the vehicle to a dealership**. Here are the numbers:
Remaining Loan Liability Balance in QB: $39,001.71
Payoff for Loan to bank: 39,266.78
Dealership gave us: 38,000
Difference between QB liability balance & Payoff: $265.07 (This was paid from personal funds but needs to be reimbursed by the business).
How in the world do I record this? What are the journal entries? The biggest hang-up I have is that I will have to recapture some of the depreciation and I'm not sure how to do that. Thanks for any help you can provide!
**(We actually traded it in but the new vehicle is now a personal vehicle rather than for the business. We are selling our shares to our business partner soon).
Solved! Go to Solution.
Is the $265.07 discrepancy between the loan payable balance in QB and the payoff amount interest or something else? Assign that account to the debit entry of $265.07.
Debit Credit
Accumulated Depreciation (Section 179) 51,869.09
Loan Payable 39,001.71
Interest Expense or ???? 265.07
Vehicle 51,869.09
Owner's Equity 265.07
Gain On Sale 39,001.71
Hello there, TBailey.
Although we recommend not to mix business and personal funds, there can be times that the business funds pay personal expenses or vice versa. In QuickBooks, here's how we handle them.
First, let's record the business expense you paid for with personal funds using a journal entry.
Once done, you can either use a check or expense to reimburse the money.
I also suggest reaching out to an accountant to help you record your loan assets and the correct account to use in your Journal Entry.
Fill me in if you need more help by leaving a comment below. I'll be around in the Community to help. Take care and have a great day!
Is the $265.07 discrepancy between the loan payable balance in QB and the payoff amount interest or something else? Assign that account to the debit entry of $265.07.
Debit Credit
Accumulated Depreciation (Section 179) 51,869.09
Loan Payable 39,001.71
Interest Expense or ???? 265.07
Vehicle 51,869.09
Owner's Equity 265.07
Gain On Sale 39,001.71
Thank you so much! It seems so obvious now, lol. I just couldn't wrap my head around it.
Hello Rainflurry,
I have reviewed the solution you’ve shared and it's correct and accurate. Thank you for sharing your inputs to help address the issue.
We love to see members supporting one another! Have a great day.
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