How do you account for the trade in of a vehicle that still has debt

It depends if the transaction has commercial substance or lacks commercial susbstance, which will determine how you will record this transaction.

I just want to know the Journal Entry that I should make this is what I have so far, but it doesn't seem correct:

AUTOMOBILES (37,933)
ACCUMULATED DEPRECIATION AUTOS 20,231
AUTOMOBILES 47,182
N/P- CMof LTS Old Truck 2,621
N/P - LTD Old Truck 4,171
N/P- Current Maturity LTD New truck (5,945)
N/P - LTD New Truck (23,283)
Gain on Asset Disposal (7,044)

Any sugestions?

There are two different ways to account for an exchange.

One Way is if there is a Commercial Substanse

The Other Way is if there is a lack of Commercial Substance.

You need to figure this out first before you can record the transaction.

If this is for homework, the problem should tell you if the exchange has or lacks commercial substance.

Also members cannot help you if you are lacking information.

This one has commercial substance they are both the identical vehicle just the new one is 2 years newer

Now that I think about it no commercial substance this is just a vehicle owned by a company it is not going gto be used for anything other than driving around