Gain/Loss on Business Vehicle

[Scott CTU]

Fiscal Accounting July 01 to June 30th
Business use 100%
Traded 2018 Cadillac XT5 for 2020 Cadillac XT6

Purchase Price 2018 XT5 10/04/2018 $ 55,437.26
Total accumulated Deprecation $ 55,437.26

Trade in Value $ 27,500.00
loan Balance $ 31,300.80

Total NET Trade in <$ 3,550.80> credit

Here is where it gets tricky
Dealer gave Manufacturer's Rebate on 2020 XT6 $ 2,000.00
Paid Cash of $1,550.80
Brought 2018 XT5 loan Balance to $ 0.00 $ 3,550.80

Purchase 2020 Cadillac XT6 08/13/2020 $66,848.41
New Loan on 2020 XT6 $ 66,848.41

What are the Journal entries
What is the Gain/Loss on this transaction

[M-MTax]

Your loan balance is not relevant so you have a sale of your old vehicle for $27,500 and it looks like that's all taxable because that asset is fully depreciated. 

Add the other costs to the basis of your new vehicle and subtract the rebate from the basis to get the depreciable basis. 

Note sure how you set up your balance sheet so post what it looks like before the trade in.

[Mike9241]

				DR	CR
OLD AUTO					55,437.26
OLD AUTO ACCUM DEPRECIATION				55,437.26
OLD LOAN				31,300.80
GAIN OLD AUTO					27,500.00
NEW AUTO				64,848.41
NEW LOAN					66,848.41
CASH					1,550.80
UNKNOWN DIFFERENCE					250.00
				151,586.47	151,586.47

[Scott CTU]

This is The Journal entry I	Have so far
	db	<cr>
Trade-in Vehicle Xt5		-55,437.26
accum dep Xt5	55,437.26
New Vehicle XT6	66,848.41
loan XT6		-66,848.41
Trade-In XT5 loan	27,750.00
Gain/Loss Xt5		-27,750
cash from checking		-1,550.80
Loan XT5 ( Rebate)	2,000.00
What Account to <cr>		-2,000.00

[Scott CTU]

This is The Journal entry I	Have so far
	db	<cr>
Trade-in Vehicle Xt5		-55,437.26
accum dep Xt5	55,437.26
New Vehicle XT6	66,848.41
loan XT6		-66,848.41
Trade-In XT5 loan	27,750.00
Gain/Loss Xt5		-27,750
cash from checking		-1,550.80
Loan XT5 ( Rebate)	2,000.00
What Account to <cr>		-2,000.00
	153,586.47	153,586.47
It Balances but is the REBATE	on the the new	Vehicle
applied to the Gain on sale

[Scott CTU]

i posted what i have on the thread. not quite sure how this works??? Thanks for Help.