BYD2411 Need Accouting Support

[SAPSupport]

Hello,
We sold a vehicle categorized as fixed asset with a PO $27,999.97. The FA number is 148-0, individual material number DIGITS. The payoff balance on the vehicle was $23,466.81. The buyer (California Dealer Exchange) issued 2 checks: 1 check directly to Ford Motors $23,466.81 and 1 check to Landi Renzo $4,533.16. So we sold the vehicle with a gain.

I can issue an invoice for the $4,533.16, but I am having a hard time how to account the payment issued to Ford Motors directly by the buyer: California Dealer Exchange. I need to zero out the fixed asset in SAP for this vehicle.



Thank you.

Merylou

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[SAPSupport · Accepted solution]

Dear Customer,

Thank you for reaching out regarding the retirement of a fixed asset and the associated split payments. Here’s how to account for this transaction in SAP Business ByDesign to ensure the fixed asset is fully retired and the financial records are accurately reflected.

1. Retirement of the Fixed Asset

Start by creating a Retirement Document in SAP Business ByDesign to remove the asset from the books. This document should reflect the total book value of the asset.

• Navigate to Fixed Assets → Fixed Asset Management → Fixed Asset Master Data, locate the asset, and initiate the retirement process.
• Select the appropriate retirement type and ensure the full book value is included.

2. Issuing a Customer Invoice for the Direct Payment Received

If part of the payment was received directly from the buyer (representing a gain or sale proceeds), create a Customer Invoice to reflect this amount.

• Go to Customer Invoicing → New Invoice and issue the invoice to the relevant customer.
• This will ensure the revenue from the sale is properly recorded in the financial statements.

3. Accounting for the Payment Made Directly to a Third Party

If the buyer made a payment directly to a third party (e.g., a lender or supplier) to settle an outstanding balance, this needs to be accounted for without affecting the company’s bank accounts, while still clearing the corresponding liability.

Approach:

• Create a Manual Journal Entry in the General Ledger Work Center:
  • Debit: A liability or clearing account to represent the payoff of the outstanding balance.
  • Credit: The fixed asset account or an asset clearing account to reduce the book value of the asset.

This approach ensures the asset’s value is cleared correctly, even though the payment did not go through the company’s accounts.

4. Final Reconciliation

After completing these steps:

• The fixed asset will show a zero book value in SAP Business ByDesign.
• The revenue from the sale will be properly recorded.
• The direct payment to the third party will be accounted for, ensuring both the asset and any related liabilities are cleared.

Please let me know if you need further guidance on any of these steps or if you'd like to schedule a session to review the process in detail.

Best regards,
Pooja