Recording of Motor vehicle Asset purchased on credit
I bought a new Vehicle - Invoice Shows R 150 000. It was 100% Bought on Credit.
The Financing Company - Bank Statement Opening Balance Reflects more than the Vehicle Purchase Invoice, as it Includes Vat & Finance Charges. It shows R 250 000 instead.
Which amount do I reflect in my Asset Account - Motor Vehicle, on which to claim Depreciation on. The 150 000 surely and not the R 250 000?
Kindly indicate which accounts I then need to Debit & Credit, to be able o reflect the above transactions as such.
If I Dt - Asset Vehicles with R 150 000 and
Kt - Long Term Liability Loan - with R 150 000 as well, my Long Term Liability account will then not be matching my Bank Statement from the Financial Lender.
Please assist urgently.
Regrds
Siegie
