How would I model the trade-in of a vehicle for a new vehicle? I added the sale of a vehicle and then purchase of a vehicle but then the sale generates income. I'm trading it.
To clarify, I'm trading in an existing vehicle so there no "income" is generated. Doesn't seem to be a way for Pralana to model this. What I did was to greatly increase the depreciation rate so the the trade-in vehicle is worth very little - then Pralana will show only a small of income from the trade-in. Anyone think of a better way? Could this be added to Pralana?
@steve-a-schulzgmail-com I'm not sure what the problem is. The money you get from your trade-in vehicle is income that you use to reduce the effective cost of the new vehicle, but it's not taxable income UNLESS it exceeds the cost basis (the trade-in value is higher than what you paid for it). So, Pralana considers this income and it figures into your annual cash flow. I think this is correct.
Stuart
@smatthews51 Thanks Stuart. Your reply in general is correct. Maybe I am entering the cost of the new vehicle incorrectly? I assume I am going to pay $70k for a new vehicle in 2035 which is when I trade in the current 2019 vehicle. So I enter $70K for the new vehicle in 2035. The current vehicle generates some income in 2035 - Pralana shows about $21k in my case ($35k current value less 5% depreciation per year). Perhaps I need to enter $70k less $21k for the cost of the new vehicle?
I was thinking (maybe hoping) that Pralana could somehow link the sale of a current vehicle and the purchase of a new vehicle. Then Pralana could automatically apply the income (trade-in value) of the current vehicle to the price of the new vehicle - perhaps by giving the user an option to check a trade-in option or some user interface like that.