how to record transactions for fully depreciated vehicle after selling

[Ravinder]

Hi there,

1.   I bought a VAN for business on 21 January 2019 for $9000 from someone. I fully depreciated it as an instant              assest write off in the annual tax return 2018-19. Now I have sold the vehicle to someone on 2.12.2020 for                  $5500. The buyer has deposited $100 as advance payment and rest of the amount he paid by cash.

2.   After selling the vehicle I also paid the amont of $437 for registration and the buyer transfered the same amount into my account. 

    please guide how to record the transactions?

Kind Regards

Ravinder

[Tracey_H]

Hi @Ravinder 

Thanks for your post. As advised on your earlier post, Sale/disposal of motor vehicle, you will need to discuss this with your accountant. Some accountants prefer these transactions be recorded as General Journals, while some prefer they are recorded as Sales. Your accountant will also need to advise which accounts to allocate the payment amounts to and the applicable tax codes.

If you need assistance with your software please do let us know, we are happy to help.

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[Julie_A_C · Accepted solution]

Hi @Ravinder 

Do a general journal entry (tax inclusive/sale ticked) memo sale of van

Credit Other Income account-Sale of Capital Item $5,500

Debit Bank $100

Debit either Loan to Director/beneficiary/owners equity (depending on business structure) $5400

Do a receive money transaction to the bank account for $437 with memo- reimbursement of rego for van sold from purchaser and allocate to the same bank account, which will account for the withdrawal and deposit.

[Ravinder]

Hi Julie

Thank you so much for your help, really helpful.

Kind Regards

Ravinder 

[Ravinder]

Hi Tracy

Thanks much for your advise.

Kind Regards

Ravinder