[GNC] Split ownership

[Stan Brown]

This is an accounting question rather than a GnuCash question. The
answer would be exactly the same if you were keeping your books in a
pen-and-ink paper ledger.

That said, presumably you had an Asset:Golf Cart account, with an
initial balance equal to half the purchase price. When you sell an
asset, you wipe out the value of that asset and replace it with a debit
to Cash and Banks.

Debit to Assets:Cash and Banks
    (amount: your half of the sale proceeds)
Credit to Assets:Golf Cart
    (amount: the balance in the account)

Those two will not be equal. The difference is the amount of gain or
loss. Therefore you have a third split in the transaction:

Debit to Expenses:Loss on Sale of Assets
    (amount: the difference between what you received the your book
    value of your half of the golf cart)
    NOTE: Some people, including me, would use Equity:Gain or Loss
    on Sale of Assets rather than an Expense. It's a matter of taste,
    since you're not a public company.

CAVEAT: Even though you received less than you paid, you may have a
capital GAIN, not a loss, as far as the IRS is concerned. The reason is
that you had the use of the asset for a period of time. There are tax
schedules for depreciation, and your gain or loss is
    (Proceeds of Sale) minus (Purchase price minus depreciation)
I am not a tax practitioner, and I don't know whether this particular
sale would be taxable even if you had a gain, and of course I don't know
whether you're subject to US taxes. But if the sale _is_ taxable where
you are, you'll need to find out the rules and compute what you owe.

Stan Brown
Tehachapi, CA, USA
https://BrownMath.com

On 2022-06-27 16:01, Fred Tydeman wrote:
> A friend and I bought a golf cart, each paying 1/2 of the price.
> Some years later, we sold that golf cart (for less than we paid, splitting
> what we got).
> How should all of that be recorded?
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