USA Purchase of vehicle-how to record cash down payment

[Offthepath]

Sorry for what I'm sure is a basic question.

We just purchased a vehicle that will be used primarily for business and is titled under the business name. We will depreciate the cost of the vehicle annually. The question is, how to a log and record the down payment on our general ledger? It was cash going out, but I cant list it as an expense if I am depreciating it right? What account would I place this under?

Thanks
Ben

 

[BIG E]

DR Fixed Asset
CR Cash

DR Fixed Asset
CR Loan Payable

 

[Fidget]

Sorry for what I'm sure is a basic question.

We just purchased a vehicle that will be used primarily for business and is titled under the business name. We will depreciate the cost of the vehicle annually. The question is, how to a log and record the down payment on our general ledger? It was cash going out, but I cant list it as an expense if I am depreciating it right? What account would I place this under?

Thanks
Ben

What's the actual situation? Do you have the vehicle? Was the down payment a deposit with further instalments to be made, or full amount? How is it financed - directly or have you got a loan to finance it? How to account for it depends on all of that.

 

[BIG E]

A down payment is merely a partial payment of a total.
Funds for the remainder have to come from some source.
The journal entries I provided should the guide to follow to properly record the asset
for its depreciable basis.

 

[mustafijurmba]

Sorry for what I'm sure is a basic question.

We just purchased a vehicle that will be used primarily for business and is titled under the business name. We will depreciate the cost of the vehicle annually. The question is, how to a log and record the down payment on our general ledger? It was cash going out, but I cant list it as an expense if I am depreciating it right? What account would I place this under?

Thanks
Ben

Journal Entry will be : At the time of down payment : Suppose you purchased a car at 10000 and you made a down payment of 1000 only
Journal entry : Asset (car) Dr 10000
Cash/Bank Cr 1000 (Down payment)
Loan/payable Cr 9000

Thanks.