Hi all,
Please bear with me but really need some help with this one. Our family limited company has just bought some new cars but transactions are little out of ordinary I think.
Cars sold are:
4 company vehicles, and one director personal car. Value of £60,000 in total trade in value.
Cars bought are:
5 new comoany vehicles with part HP and the £60k trade in value.
My question is this:
Effectively the director decided to put their personal car in as trade in and then have a company vehicle from now on with everyone else. So how do I account for this.
The directors ( my i laws) do not want the physical money (£12,000 trade in) but want it reduce the drawings they have taken for the year through DLA.
Need to do journals to acquire new vehicles which is fine but do I need to treat £12,000 part ex value of personal car as dr motor vehicles cr DLA??
Will this work as effectively they have given a cash injection to company even though no physical money has changed hands.
Replies (3)
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You credit the DLA with the trade in price of the personal car.
But surely your company's accountant will sort all this out for you?
Yes
You are correct - debit Motor Vehicles (as your previous entries will be net of the trade in value) and credit DLA.