We purchased a new car and traded in an old one. How can I get the old car off the books and put the new one on?
Thanks
Cindy
We purchased a new car and traded in an old one. How can I get the old car off the books and put the new one on?
Thanks
Cindy
Dr. New Car
Dr. Accumulated Amortization Old Car
Cr. Old Car
And whatever other journal entries are needed based on the facts of the case...
So you will probably have a Cr. To Cash
And the net Balance (Dr. would be a loss) or if it's a net Balance of a Cr. then it is a gain.
An added note, at least in the U.S. a gain cannot be recognized on your books when trading in of like items. If you end up with a gain, you must remove that amount from the cost of the new car. i.e. rather than having the credit of the gain, you'll reduce the debit side by reducing the debit to the new car.
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