I just went through this exercise myself recently of figuring out how to
account for loans. I wanted to record the expense over time instead of all
up front. I don't have a loan out at the moment but I "refactored" my
previous two loans, using a system like this:
2013/08/17 car dealer
a: car: model 13 $20,000
l: loan: car: model 13 $-20,000
2013/10/01 car dealer
e: car: loan interest $25
e: car: payment $300
a: car: model 13 $-300 ; depreciation
l: loan: car: model 13 $300
a: checking: some bank $-325
I don't count my cars as assets, but using the asset account this way helps
make it all work. I just depreciate it at exactly the same rate that I pay
for it, so that when it's paid off it's worth nothing. :-)
On Tuesday, July 3, 2018 at 11:46:03 AM UTC-5, Shane wrote:
>
> I just bought a new vehicle and I'm not quite sure how I should go about
> structuring accounts and transactions to give me the most accurate
> reporting.
>
> 1. Should the car's value be an asset? How would I handle depreciation?
> 2. If the car is an asset, should I convert it to a commodity to track
> depreciation?
> 3. Should my down payment pay off the new liability account I created?
> 4. What account should interest be credited/debited to?
>
> Here is what I was thinking:
>
> // should the new car be an asset? would it be better to convert it to a
> commodity?
> 2018-07-02=2018-07-02 * dealer
> ; note: new car
> ass:car 20,000.00 USD
> lia:debt:car -20,000.00 USD
>
> // is it correct that my down payment should pay off the liability?
> 2018-07-02=2018-07-02 * dealer
> ; note: down payment
> lia:debt:car 4,000.00 USD
> ass:checking
>
> // where should interest go?
> 2018-08-01=2018-08-01 * bank
> ; note: car payment
> lia:debt:car 1,000.00 USD
> exp:interest:car? 150.00 USD
> ass:checking
>
> I would greatly appreciate some examples of how you tracked your new
> vehicle.
>
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