Hp agreement - sale of asset

Hi, I am really not clear on the treatment of the HP creditor on the sale of an asset.  What do I do with the balance of the HP Creditor £76,000?  What am I missing?  Thanks for any help.

 

Jim

 

eg  Car bought for £89,000, Loan £79,000, deposit paid privately £10,000, Capital element of loan paid £3,000,

Car later sold (traded in) for £60,000.

 

Dr Vehicles   £89,000

Cr HP creditor £89,000

Dr HP Creditor £10,000

Cr Capital a/c £10,000

Dr HP Creditor £3,000

Cr Bank  £3,000

Dr Capital a/c £60,000

Cr Vehicles  £60,000

Dr Loss on sale £29,000

Cr Vehicles £29,000

Comments
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Never mind the car ...

Euan MacLennan |
Euan MacLennan's picture

Missing value of the new car

Anonymous |

HP agreement

Anonymous |

Look out for the coon.

Anonymous |

Euan is spot on - again

Democratus |
Democratus's picture