When fixed assets, such as a company car, are sold, several entries need to be made.
Sale of the assets:
You create the invoice through the sales invoices based on the agreed sale price.
Usually, this is a VAT-taxed transaction.
The book value of the assets must be reduced to zero.
Additional entries
After creating the invoice, further entries need to be made.
In the example below, we assume a purchase value of €60,000 and depreciation of €48,000.
Booking reinvestment reserve
If there is a profit on the sale and you wish to use the reinvestment reserve, the following entry must be made. You do this by debiting the profit to the cost of sales account (used in the previous entry) and crediting the same amount to the reinvestment reserve account. If the general ledger account does not yet exist, you will need to create it as a Balance type with the account type "Normal account."
