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car loan entry

CMA. Rakesh Kataria (Practising Cost Accountant) (531 Points)

21 March 2011

My. company purchased a car for Rs. 5719780, paid down payment by Rs.11,19,780 balance amount Rs. 46,00,000 by ICICI car loan.

ICICI paid to car company Rs. 46,00,000 and give loan statement showing ICICI deduct first instalment of Rs. 146826 upfront balance amount Rs. 44,53,174 by 35 installments.

Pl. advise the accounting entries of ICICI car loan.

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12 Replies

CA SHRIPAL LUNIYA (CA, CS Final & M.Com) (744 Points)
Replied 21 March 2011

1. When Car Purchased...

Car A/c Dr. 5719780/-

to Bank A/c 1119780/-

to ICICI Loan A/c 4600000/-

2. When First Installment Paid....

ICICI Loan A/c Dr. (146826-Interest*)

Interest on Loan A/c Dr. Interest Amt.

to Bank A/c 146826/-

*Interest amount as per statement.

5 Like

CA Saroj Kumar (Keen to learn something new every moments) (2588 Points)
Replied 26 March 2011

i agrre with sripal

Srinivas Ch (Sr.Accountant) (365 Points)
Replied 10 August 2016

1.When car purchase: journal voucher

Car(fixed asset) Dr (total car value)

To, showroom a/c(liabilities)(down paymnt)

To , icici car loan(secured loan) (loan amount)

2. When down paymnt: paymnt voucher

Showroom a/c dr...

To bank/ cash.

3. Emi to icici: journal vchr

Interst on loan a/c dr....

To, icici car loan accnt

4. Emi paymnt: pymnt vchr

Icici car loan dr...

To bank accnt

(When taking loan from banks you have to collect repaymnt schedule statemnt from bank).

venkatesh vudum (Accountant) (54 Points)
Replied 17 May 2017

Dear sir,

thank you but i have one dout sir if interet crosed the 10000/- in f.y TDS applicable sir what is the entry for that.

Manu Krishnan (2 Points)
Replied 02 January 2018

In gst how it can be entered ??

yasin143 (sr acc) (26 Points)
Replied 18 July 2018

Car cost Rs1246008 and TCS Rs12460, on loan bases we have purchased how to pass the entries against TCS

yasin143 (sr acc) (26 Points)
Replied 18 July 2018

in case we can not claim GST how to pass the vehicle purchase entry

Srinivas Ch (Sr.Accountant) (365 Points)
Replied 03 November 2018

Please tell as per invoice...

Srinivas Ch (Sr.Accountant) (365 Points)
Replied 03 November 2018

TDS mentioned or not in your loan agreement?

Rajesh TM (Accounts Manager) (132 Points)
Replied 24 November 2018

sir,

could u pls tell me the entry of tcs1% when we purchase car in the name of firm.

Ayushi Arora (298 Points)
Replied 27 February 2021

Lenders offer loans on both new as well as pre-owned cars. However, the interest rates are different for new and pre-owned cars. For the former, the rate is in the 9.25-13.75% range, whereas for the latter, it is between 12.50 and 17.50%.

Applying for a car loan is easier as it requires less documentation as compared to a home loan. Also, there is no additional collateral asked for as against in the case of the former. The loan itself is secured against the car. However, while buying a car, do not stretch your budget.

GST is not applicable on your EMI payments.

Nandu V V (2 Points)
Replied 30 October 2021

when Company A purchase a Car by loan, The Loan is in the name of Company B, B pays the emi later A payback to B the paid Amount. How to account this?