Record equipment trade in against Loan

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  • Updated 6 months ago
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We recently purchased a new piece of equipment under finance, but we also traded in an old machine to go towards the purchase.

I went to put in a journal for the purchase of the equipment like this:

Dr  Plant & Equipment     GST on capital purchase

Dr  Borrowing Costs        No GST

 Cr  new loan account           No GST

Cr  Plant & Equipment  (TRADE IN)   GST on Sales

However, Reckon wont let me put in both sales and purchase on a journal entry, comes up with an error.

How do I enter this transaction?

Im using Reckon accounts Hosted
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Jeremy

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Posted 6 months ago

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John Gibson, Accredited Partner

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Two options - use the GST code on both debit and credit, instead of CAG on purchase and GST on trade-in - should work.

Alternative for the Cr Plant & Equip assign with no code to Op Bal Equity, then 2nd entry Dr Op Bal Equity and Cr Plant & Equipment at cost account for the trade-in amount (with the GST code)
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Jeremy

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Thanks for your reply John,

It didn't prompt me when I did the GST on both, but when i tried to do NO tax code on the other lines, it gave me the error again.
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John Gibson, Accredited Partner

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Leave the others blank, with no code listed at all.....