Journal entry for trade in
June 22 journal entry
Traded the old company truck for a new truck issuing a check to Commercial Truck Sales and Repairs.The cost of the old truck is 10,000 and on March 31, the end of the previous quarter it had depreciated $7,530 (at $60 a month). The new truck has a list price of $14,000 and a trade-in allowance of $2,800 was given for the old truck.This trade has no commercial and no gain or loss will be recognized on this transaction.
1) First, record the depreciation to date on the old truck. Straight-line depreciation is $60 a month.
2) Second, record the trade-in.