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accounting entry for sale of fixed asset

sanjaya (Accountant) (85 Points)

08 September 2010

My query is : If a fixed asset which is a scorpio Car purchased with a loan from a Bank sold then what will be the accouting entry for the given details.

WDV of the Car on 31/3/09 is 564427.94.

Sale value of the car is 460000.00.

Amount paid by the party 261557/- and for closure of Loan account 198303/-

Vehicle sold in the month of June 09.

I want to know the entry for closure of loan account and sale of the fixed asset.

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13 Replies

Rahul Agarwal (Future CA) (217 Points)
Replied 08 September 2010

Bank A/c Dr 460000

To FA A/c 460000

Loss on sale A/c Dr. 104427.94

To FA a/c 104427.94

Loan A/c Dr. 198303

To bank a/c 198303

Sheetal Metha (Article Assistant) (208 Points)
Replied 08 September 2010

Detail Entry for sale of Fixed Asset - Scorpio

Attached File : 43 sale fixed asset scorpio.txt downloaded: 2264 times

4 Like

Pkala (CA Final (New Course)) (211 Points)
Replied 08 September 2010

I agree with Sheetal Metha

Prateek (B.Com(H) PGDBA CA Final) (436 Points)
Replied 08 September 2010

Dep Dr 21166

To Car 21166 3 mnths Depreciation

BANK Dr 261557

Loss on sale Dr 83261.94

Loan A/c Dr 198303

Round Off Dr 140

Car Cr 543261.94

Faiz Ahmed ( Article Trainee) (1731 Points)
Replied 08 September 2010

Absolutely right Sheetal Mehta. Good work ...

Kalpesh Chauhan, (Tax Assistant (Accounting Technician CA FINAL CS PROF. PROG. B.Com)) (8310 Points)
Replied 08 September 2010

I have just modified the answer.

Attached File : 22 answer.txt downloaded: 910 times

ravi tej (ca final) (392 Points)
Replied 09 September 2010

It is recommended to assume that the scorpio sold at 1st june2009. 1. W.D.V=564427.94 2. W.D.V as on 1stjune=564427.94-564427.9415%2/12=550316.94 Less sale proceeds =460000 Loss on sale =90316.94 3. bank a/c Dr.261557 party a/c Dr.198443 p&la/c Dr.90316.94 To scorpio a/c550316.94 4. bank loan a/c Dr198303 to bank a/c198303

Rahul Agarwal (Future CA) (217 Points)
Replied 09 September 2010

Sorry!!!!

Mah fault

totally ignored the date part, I overlooked it.

But anyways I too agree with Sheetal

Hemu Kapoor (CA - Final Student) (158 Points)
Replied 09 September 2010

I AGREE WITH SHEETAL

Divya Karthik (S) (459 Points)
Replied 10 September 2010

If its profit on sale of the fixed asset, we have to disregard it fron the computation right?

Mamata Chavan (ca final ) (34 Points)
Replied 12 September 2010

In above Case can we claim depreciation (Rs.21166/-) against our business income or claim short term capital loss as block of assets get zaro, and if block of assets not zero then what would be the treatment !!!