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Jul 10, 2022 8:05 PM UTC
Question

Loan Payoff

We Traded in an atv that we use for business and the dealership paid the loan off directly. How do I account for this in the Liability Register since it didn’t come through the account?

1 reply

Rustler
Jul 11, 2022 12:08 PM UTC

There is just not enough information to help you on this.

 

The ATV was traded in on something, and the amount owed was added to the loan for that something.

 

The ATV should be carried as a fixed asset on the books, which means you first have to calculate and post partial year depreciation, then clear that total amount against the ATV cost.

 

If you have not taken depreciation during the ownership of the ATV, then that is another problem which will require a tax accountant. Declaring depreciation is optional during the years of ownership, but you MUST declare all depreciation when the item is sold, or traded, or disposed of.