Child pages
  • Customer trade-ins

Versions Compared


  • This line was added.
  • This line was removed.
  • Formatting was changed.
classsection group
<span data-swiftype-index="true">
classcol span_3_of_5

Some businesses accept customer trade-ins to reduce the selling price of goods sold. For example, a car dealer might accept a vehicle trade-in and deduct the trade-in value from the price of a new car.

The steps below can be used for most trade-in situations, but you should also check with your accounting advisor about your tax/GST reporting obligations associated with trade-ins for your business.


UI Expand
title1. Set up for trade-ins

Set up for trade-ins

Before recording a trade-in, there's a couple of things you need to do.

  1. Create an asset account with the Account Type set to Bank. This account will be used as a clearing account to hold the value of the trade-in.
    Example asset account setup
  2. Create an inventory item to represent a default trade-in item. You'll use this item when recording sales which include a trade-in to deduct the trade-in value from the sale price.
    • Select the option I Sell This Item
    • For the Income Account for Tracking Sales, select the asset account created above (ignore the warning about this account usually being an income account)
    • On the Selling Details tab, select the relevant Tax/GST Code When Sold.
    Trade-In item setup with clearing account selected

You're now ready to record sales which include trade-ins.

UI Expand
title2. Record a sale that includes a trade-in

Record a sale that includes a trade-in

If the trade-in is from a new customer, create a customer card for them.

You can then enter an invoice to record the sale.

  • On the first line, enter details of the item being sold.
  • On the second line:
    • enter a negative one (-1) in the Ship field
    • select the Trade-In item created earlier
    • enter the trade-in value in the Price field

Example sale containing trade-in item

Recording this sale will:

  • deduct the value of the trade-in from the amount the customer needs to pay, and
  • deposit the value of the trade-in into the Trade-in Clearing account.
UI Expand
title23. Record a bill for the trade-in item

Record a bill for the trade-in item

When you receive a trade-in, you're effectively buying that item from the customer. Here's how you can record that purchase:

  1. Create a supplier card for the customer. This will allow you to select this supplier when recording the purchase.
  2. Create an inventory item for the trade-in item.
    • Select the option I Buy This Item. Depending on what you do with your traded-in items, you can also select I Sell This Item and I Inventory This Item.
    • Select the applicable Expense Account for Tracking Costs.
    • On the Buying Details tab, select the relevant Tax/GST Code When Bought.
    Example item setup for item being traded-in
  3. Enter a bill for the trade-in item.
    • In the Supplier field, select the supplier card you created for the customer.
    • Select the trade-in item in the Item Number field.
    • Enter the trade-in value in the Price field.
    Example purchase for traded-in item

Recording this purchase will account for the receipt of the trade-in item.

UI Expand
title34. Close the bill for the trade-in item

Close the bill for the trade-in item

You can now close the bill using the funds which were allocated to the Trade-in Clearing account when you recorded the sale.

On the Pay Bills window:

  • Select the Pay From Account option and select the Trade-in Clearing account.
  • In the Supplier field, choose the supplier card you created for the customer. Their open bill will be listed.
  • In the Amount field, enter the trade-in value.
  • Apply this amount against the bill.

Pay bills window with trade-in clearing account selected

Recording this payment will:

  • close the bill, and
  • clear the balance of the Trade-in Clearing account.
classcol span_1_of_5
classcol span_1_of_5
titleRelated topics

Set up accounts

Creating , editing and deleting items

Enter an invoice, quote or order

Enter a bill, quote or order

Paying bills

titleFrom the community

RSS Feed


More »