Account entry for sale of house on which home is taken.

If Asset is in your balance sheet , and for example you sold Home to Mr A then pass the entities as follows.

1) Bank A/c Dr
To Asset ( Home)
( Being Asset sold )

2) Loan. A/c Dr
To Bank A/c Cr
( repayment of half loan)

3) Loan A/c Dr
Loan paid by A A/c Cr
( remaining loan payable by Mr A )

Loan paid by A A/c ( Byer) will be under Indirect Income profit and loss account.

Gain on sales will be credited to capital ac?

If the house Building is for business purpose, after deducting Depreciation ( WDV from 1st April to date of sale) balance profit will be credited to profit and Loss account. . so 1,St entry will be

Bank A/c Dr 
Depreciation A/c Dr
To Asset ( Home) A/c Cr
To profit on Sale A/c Cr
( Asset sold , profit credited after Depreciation)

 

Profit  on sale  will be  transfer to  profit  & Loss  Account 

profit  on sale  A/c  Dr 

To  profit & Loss  A/c  Cr 

(  Profit  transfer to  P&L ) 

 

Depreciation will  be  transfer  to  P& L  entry 

Profit  & Loss  A/c  Dr 

To Depreciation  A/c  Cr 

(  Depreciation  transfer entry ) 

 

 

 

 

Sale Entry

Buyer A/c (Sale value)
To House
To capital (Profit)

payment rec entry

Bank A/c (amount received in bank)
Home Loan(loan paid by buyer)
To Buyer