I sell machines but accept trade in of old machines.

Day 1 - sold new mach at $150 but allowed trade in of old mach. Buyer paid $70 after trade in of old mach
Day 5 - sold old mach that was traded in at $60.

How should I record the 2 sales transactions?

YES, you should record both transactions.

DEBIT Cash Account $80
DEBIT Trade-in Machine Account $70
Credit Sale of New Machine A/c $150

Being sale of new machine partly for cash and partly trade-in.

______________________________

DEBIT Cash Account $60
DEBIT Loss on Sale of Trade-in A/c $10
CREDIT Trade-in Machine A/C $70

Being sale of traded-in machine.

Is selling machines what you do? i.e. is this inventory to you?

Thank you!

Is selling machines what you do? i.e. is this inventory to you?

Yes, machines are my inventory

Then this is treated as purchases and sales of inventory and a machine account is not involved, nor is a loss. i.e. it's an inventory account rather than a plant asset.

I'm not positive if there's anything you have to do with trade-in's of that sort. But it seems you got $150 of value - $70 in cash and therefore what you consider $80 worth on a used machine, which is inventory. And then $150 of sales.

This wouldn't really be any different than if you got all $150 for the sale, and simply used $80 of it to buy the used one to put into your inventory. If you did anything to the used one in order to put it in a better selling condition, you should be able to count that as part of your cost.

When then re-selling, it's another sale, at $60. And $80 coming out of inventory and going into COGS. Yes, you lost, but losing on merchandise selling isn't a "loss" account. It'll affect your overall gross profit in the long-run.