Posting a Business Vehicle Fixed Asset Purchase

This article deals with posting a business vehicle fixed asset purchase in your books.

Let’s assume the following items on your motor vehicle buyers order:

• Tax, Title, License and Registration fees
• GAP Insurance
• There was a cash deposit from the buyer.
• The vehicle is financed primarily by a loan.

In this article, we are not concerned about a trade-in, rebates, extended service agreements, other fees, etc.

Before proceeding in your books, you will need to create the following financial accounts in your books:

• Vehicle Fixed Asset account
  • I would also create two sub-accounts here: One for the Purchase of the vehicle and the other for the ongoing Accumulated Depreciation.
• Vehicle Long-Term Liability account

So, now let’s post that business vehicle purchase:

Note: AccuraBooks is a bookkeeping firm only, so please consult with your C.P.A. for verification and clarification about the contents of this article.