Posting a Purchase Invoice for a loan including part ex

Cordie

Following on from my previous post about loans, thanks guys for replying, I went back to enter the actual details and have now got really bogged down as I cannot fathom the double entry on part of it.

Okay deep breath!

Purchase invoice for £202,750 + VAT
Less £16,000 + VAT for piece of equipment not on books
Leaves £186,750 + VAT
Deposit paid through bank of 10% - so £18675 + VAT (£21943.15 - has left bank)

So assume loan will be £168,075.00

I am trying to enter all this onto SAGE and just don't seem to be able to do it as the part exchange will have to be entered as sundry income, the invoice mentions VAT to contra on the part exchange and they wanted a sales invoice from us for it. I am just lost in a sea of double entries, there has to be a simple way of doing this that I am missing, as it never balances I am always left with a lump of VAT thats left over.

HELP!

Jan

Cordie,

I had something similar recently - it had me scratching my head for a while! Can't work your figures out - are you sure your assumed figure for the loan is correct?
Not much help I know, but I'll have a look how I posted my PI when I get back to work tomorrow. I do know that I had to post a sales invoice for the sale (in my case) of the asset.

You'll probably look at it again in the morning and it'll just fall into place. :001_smile:

Poodle

Hi Cordie

I would post as follows:

Open a supplier account and post the £238,231.25 invoice to fixed assets (£35,481.25 input VAT)

Open a customer account and post a sales invoice for the part exchange £18,800. £16,000 credit to capital introduced or DLA, £2,800 output VAT. [ you do not say if this is a ltd company or not and I have assumed that the asset has been provided to the business by an owner or a director as it is not already in the 'books'] and post this invoice to the supplier.

In the bank account post a supplier payment for the 10% of £21,943.15

Then in a bank account that you do not use I would:

Post a bank receipt for £18,800 to the customer account to take that to nil.

Post a bank payment to the customer account for £18,800.

The balance on the supplier account should now be £197,488.10. The amount of the loan.

Go back to the bank account that you do not use and

Post a bank payment to the supplier for the £197,488.10, to take that account to nil. (reconcile off)

Post a nominal ledger receipt, outside the scope for VAT (T9) to 2300 loans or 2310 HP for the amount of the loan £197,488.10

Reconcile the bank account to nil for tidiness.

I think that you became confused with the VAT. Only two entries have this attached the loan does not so £168,075 + 17.5% = £197,488.10 that is the amount of the loan.

If I have a client that has several loans like this then I also open different NL accounts for each loan for control.

Regards

Poodle

Jan

Poodle you beat me to it! :001_smile:

Cordie

Hi guys

I went in today and had a go at doing it, I used a contra account to enter some of the transactions and did pretty much as you suggested Poodle, only thing was I put the sales invoice to sundry income.

You are right, I confused the VAT this was partly me and partly the nature of the very confusing invoice sent by the supplier. I rang them and they admitted they were confused, couldn't remember how or why they had done what they had and yes, it was wrong anyway!

I am quite annoyed really as the accounts are in a complete mess, they have several loans for which they have lost the paperwork, and some which they neglected to tell me were where the machinery is purchased by the HP company so I am trying to locate invoices on statements from suppliers that we have never seen anyway. Then they pass a comment that it seems to be taking a while to get the accounts up to speed. I have had 3 seperate people entering things into SAGE TOTALLY getting it wrong and I am having to sort the mess! Ooooh clients sometimes!!!!