Journal Entries for trading one financed vehicle for another

Forum|Forum|1 year ago
August 6, 2025
5 replies
152 views

Can anyone help me with the journal entries for the following:

i will set up the asset, liability and accumulated depreciation account

Old Vehicle Trade in Allowance $77,000

Old vehicle remaining financing $50,855.95

New vehicle price (inc taxes) $139,648.89 (will break out taxes)

Paid $500 Cash

Filing Fees $39.11

Total amount financed $113043.45

Total interest over contract term $16,757.81

Total $127301.76

QuickBooks Accountant Online

Rainflurry

Level 11

@Skookysnacks

You will need to depreciate the old vehicle through the day it was traded. Then, there are a couple of pieces of missing info:

1) What was the purchase price of the old vehicle?

2) How much accumulated depreciation have you taken on the old vehicle?

When you have those, the journal entry will look like this:

	Debit	Credit
New Vehicle (fixed asset)	139,648.89
Old Vehicle Loan (to close)	50,855.95
Accumulated Depreciation	XXX
New Vehicle Cost (fixed asset)	139,648.89
Old Vehicle Cost (to close)		XXX
New Vehicle Loan		113,043.45
Cash (Bank Account)		500.00
Gain/Loss (to balance entry) Debit = Loss, Credit = Gain		XXX

SkookysnacksAuthor

Thankyou. I have the original purchase price of old vehicle $105547.01 but I don’t know the depreciation as the accountant has been lumping all vehicle depreciation together at year end. Is there an entry I can do now and then they record the depreciation later? At year end?

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