How to enter trade-ins

Quite well, thank you.

I can't find anything in the help

Put the tradein on the same invoice as a minus qty

Greg

I hope those that know me realize that I do know the answer. Bobby Boy will just think I don't want to "bother" answering the question in light of my previous response.

Wrong answer Grasshopper, try again.

OK, thanks.

Bob

I don't know the correct way to do this from an accounting standpoint. From a bookkeeping perspective on how to get the info on the books one way would be to create a customer credit using the trade-in as a line item (create a new one for inventory if its not already there) and the amount is whatever you deem the value of the trade-in. Now the customer has a credit. Create an invoice for the new item at its regular price. The difference is what's payable and in Receive Payments you can account for the credit and whatever method of payment is used for the balance.

Can't do it this way because the sales tax will calculate on the entire amount when the invoice for the new item is created. The actual sales tax is figured only on the difference between the selling price of the new item and the trade-in, that is to say the final amount the customer pays is taxable, not the original selling price of the new item. It was suggested to simply enter the trade-in as a negative item. That'll give the necessary tax and invoice amounts.

Bob

Way to go Bobby Boy. MAke my day, use the above.

Oh my oh my. A tad complicated don't you think? Can you image having to deal with numerious trade-ins this way. I'm getting dizzy just reading this. There is a simple way, I left a clue in my previous post of where to look for the solution.

By the way your method will not account for the transation correctly to boot.

I could tell you but its for Bobby Boy and I don't want to "bother".

I would have thought you were supposed to tax the full sale price and treat the trade-in as a payment form.

I'll double check it, but I think the value on the trade-in is taxed when the trade-in is subsequently sold. Otherwise, there would be a double tax on the same item.

Bob

In most states if the item traded-in will be used for resale in the normal course of business then taxable sales are reduced by the trade-in allowance.

There is an answer to the problem, and oh, by the way the method does take into account the proper way to handle sales tax.

I just checked the tax code online. The amount of the trade-in is excluded from the taxable selling price of the new item. I sell a new item for $800, customer trades in $300 item, taxable amount is $500 on this sale. When trade-in is sold, it will be taxed for $300 selling price. Trade-in must be noted on invoice with model and s/n where applicable.

Bob

I will award a QB Black Belt to anyone that gets the right answer to this problem.

Put on your thinking caps.

Are you a QB Guru?

Not a guru but my answer was the correct one.

Greg

Yep, I appreciate the information.

Bob

Except for the fact that it did not take into consideration the distortion of sales, cost of goods sold and inventory valuation. Other than that, it was the correct answer.

Thats because you are an idiot.

In the real world it works, and did everything that was asked.

Greg