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Nika Sutton
February 8, 2023
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How to report loss on vehicle trade in?

  • February 8, 2023
  • 1 reply
  • 0 views

Hi!

 

I am still pretty new to QBO. I am currently recording our assets and am a little stuck.

We purchased a vehicle cash for $15,000 last March and then traded it in for a different vehicle(with a loan). Trade in value was only $12,000. How do I record the $3,000 loss?

 

Thank you!!

Best answer by Rainflurry

@Nika Sutton 

 

Record a journal entry similar to below.  For illustrative purposes, I assumed a new vehicle purchase price of $30K.  Change the numbers for the new vehicle asset and loan payable for your specific case.  Debits and credits must be equal.

 

 DebitCredit
New vehicle - Fixed asset (purchase price)30,000 
Loss on disposition of old vehicle3,000 
   Old vehicle - to remove from books 15,000
   Loan payable 

18,000

 

 

1 reply

Rainflurry
Rainflurry
February 11, 2023

@Nika Sutton 

 

Did you trade in the vehicle in 2023?  If so, you will need to contact your CPA/tax accountant and figure out the depreciation that needs to be taken into account.  You may not have a loss to record depending on the amount of depreciation taken on your 2022 tax return.

N
Nika SuttonAuthor
February 12, 2023

@Rainflurry 

 

Thank you for reaching out!

No, I bought the vehicle in March 2022 and traded it in October of 2022.

Rainflurry
RainflurryAnswer
February 13, 2023

@Nika Sutton 

 

Record a journal entry similar to below.  For illustrative purposes, I assumed a new vehicle purchase price of $30K.  Change the numbers for the new vehicle asset and loan payable for your specific case.  Debits and credits must be equal.

 

 DebitCredit
New vehicle - Fixed asset (purchase price)30,000 
Loss on disposition of old vehicle3,000 
   Old vehicle - to remove from books 15,000
   Loan payable 

18,000

 

 

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