Hi,
I have a van in the books as follows:
- The van is tracked with its purchase price P as an asset in (0050) Motor Vehicles.
- The loan L (net loan excl. interest) itself is tracked in (2321) Van loan
- Monthly payments are automatically split between paying down (2321) Van loan and (7903) Loan Interest Paid
Due to unforeseen circumstances the company needs to wind down, and therefore the van has been sold:
- The van has been sold at price S to a service provider (at a loss, i.e. S < P; no depreciation has been recorded))
- A finance settlement agreement has been obtained form the lender for early repayment. The settlement covers amount payable, rebate, and a settlement figure F, which is the net loan plus some interest: R = L + I
- The service provider took on the finance settlement, and the difference between sales price S finance settlement F has been paid to the service provider.
- The service provider’s purchase invoice includes the following line items:
- Sales price S
- Finance settlement F
- Transaction fee T
- Balance transfer B = S - F - T
- Amount payable is therefore £0.00
How do I properly record this in the books so that:
- the loan is settled,
- the van taken off the books,
- finance settlement interest is tracked as loan interest paid, and
- the loss of van sales is also tracked as a sales loss
Many thanks!