How should a vehicle loan appear on balance sheet? I currently have the vehicles appearing as fixed assets and as a negative number. Then under liabilities the vehicle loans also show us as a negative number. Are the categories correct? which category should be the positive number?
Fixed Assets Truck 1 -24,280.02 Truck 2 -17,100.00 Truck 3 -28,900.00 Total Fixed Assets $ -70,280.02 TOTAL ASSETS $ -57,233.49 LIABILITIES AND EQUITY Liabilities Current Liabilities Other Current Liabilities Loan Payable Truck 1 -26,927.37 Loan Payable Truck 2 -18,393.27 Loan Payable Truck 3 -30,061.75 Loan Payable Truck 4
Having the vehicles are Asset Values; that is Basis or original cost and that doesn't change over time and is a Positive. Such as, I list that I just paid for the vehicle on the Check or Credit Card Charge would show as Positive Asset value.
Having debt also needs to show Positive, because this program shows "regular perspective" for the account Type. So, the Loan is also positive. Example:
I deposit $10,000 to Checking as from the loan proceeds, so now Loan shows positive $10,000 is owed. Then, I enter that I bought the Fixed Asset.
When I make payments against the Loan, its balance goes down. The Fixed Asset doesn't change.
If someone used Journal Entries, it looks like this:
Debits increase Assets and Credits Increase Liabilty
Debit Vehicle Fixed Asset 10,000
Credit Loan liability 10,000
You can look at the entries in these accounts to figure out what went wrong and fix them.
There is either positive and negative, or debit and credit:
"my vehicle is a fixed asset (positive number)
my loan is also a positive number"
Loan would be the error, then; the Accounting balances in the chart of accounts and the Reporting should show Positive. You should have Two Columns. Do not put Both in One Column. One is Debits, one is Credits, both as Positive.