Disposal of MV

I have a client who has sold a motor vehicle, bought through his sole trader business.

In the MV account, after putting sale price through and depreciation reversed this leaves £4,000 as a debit. balance

 

In the acounts I am assuming that I will need to

Cr MV £4k to clear this balance out and Dr P & L £4k (but where woudl this go, would this be a Cr to MV Depreciation?) as this would reduce the total depreciation figure being put through overall for the year. 

As the Asset list I have shows the NBV and if i input the net of vat sale figure this also leaves £4k as a negative figure.

 

Under her HP loan, after paying off the amount requested, and payments made thoughout the term, there is a Debit balance of £2,000.  Which although i will check out, assume is an early repayment charge or interest upon paying it off early (3 years into a 6 year term),

Will I also need to

Cr HP loan £2,000 and Dr Loan Interest in the P & L £2k

Just haven't dealt with a disposal that has cleared something out completely before.

 

Any help would be appreciated.

Many Thanks

Caspar

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Basic accounting

Euan MacLennan |
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