🚗 Being an Entrepreneur, is buying a Car an investment or liability?

[Hopey]

As an entrepreneur, when you buy car to promote you business for transporting of goods it is an asset but when you buy it just for personal use then it is a liability

 

[Setho]

You are actually in business because you want to live a good life so if you feel you have made enough money and the business is in good shape then why not use part of your profit or equity to but a nice car.

 

[Sheyemanu]

In reply to your question above concerning whether a car acquired for business purposes is an asset or a liability, well my take is that it is definitely a liability if it is for personal use, but if it is for business purposes, it is definitely an asset

 

[tyrim88]

Personally, it depends on the purpose of acquiring the Car.
If it is business oriented I will agree it's an asset to your business.
If otherwise, a car will always be a liability.
What's your take?

For me buying a car that can serve me the purpose to take me around and also to keep me going in my business is what i will prefer,as the car will bring in income for me.

 

[Heatman]

Personally, it depends on the purpose of acquiring the Car.
If it is business oriented I will agree it's an asset to your business.
If otherwise, a car will always be a liability.
What's your take?

Buying a car is just an expensive expenses on its own because it's definitely going to be costing you more money to maintain your new car, fuel and spare parts.

 

[IamDozzy]

From an accounting view, it is definitely a liability but from a business view, the car would be needed to run errands that would be beneficial to the business I'm bringing profits therefore it is an asset while it's still in good condition.

 

[Setfragil]

To make moving around easy, it why the need for a car is obvious, and since entrepreneurs move around a lot it would be best to consider if the car would keep generating only expenses with no income then it's a liability but if it produces extra income it is an asset

Yes those who owns businesses moves around a lot hence their need for a car. If the movement of a business owner is the type that will affects the business positively he can buy a car to help the business run successfully which is an investment that will profit the business.

 

[Eodine]

Yes those who owns businesses moves around a lot hence their need for a car. If the movement of a business owner is the type that will affects the business positively he can buy a car to help the business run successfully which is an investment that will profit the business.

Yeah, simply put any thing that classifies as expense is a liability while anything that generates income is an asset so it is important to know if an entrepreneur can afford to get a liability or get an asset.

 

[Bookwormlux1]

A book I'm reading says the moment you drive out of the place where you bought your car, it has depreciated by 25 percent. Cars are never an investment, they are nothing but liabilities.

 

[tyrim88]

If your business requires the use of automobile to enhance and facilitate your work,then a car is one of the asset for the business otherwise it is a liability. Some businesses like supply of wholesales of goods. In this case an automobile vehicle is needed.

We have a logistice mobility where we majorly use it to do our supply and this fetch us money and the money we use to maintaining it.It is really an asset to us,because it does not take money out of our pocket.

 

[Kane]

If you are not in a position to spend money for car maintenance, buying a car will be your liability. If you have just started out, you need to keep your expenses minimum.

 

[Heatman]

Well I've been an entrepreneur and you definitely need a car to run your personal business then I believe that it's actually an investment rather than expenses because they can helps to make more money for your business

 

[Setfragil]

If you are not in a position to spend money for car maintenance, buying a car will be your liability. If you have just started out, you need to keep your expenses minimum.

You are right. Buying a car in some cases is not a wise business decision to make especially when it is a newly established small scale business. The business will continue to maintain the car which is an additional expenses to the business, if care is not taken it might result to a liability.

 

[eLdavis]

If buying the car is ment for the business like reducing the cause of transportation or using it for supply of goods and services and the likes then it is not a liability, it can be seen as an asset to the business. But if you buying the car has notting to do with the business, it can be seen as an liability

 

[Sincerem]

Buying of cars for commercial purposes isn't a liability. The option that is liability its when you're buying it for personal satisfaction, but its still an asset but its prone to damage without bringing investment returns.

 

[Haveit]

You have said the important factor, if the car being bought is used to make money, then it's a good investment as it would be considered as an asset but if it just keeps bringing up expenses then it's a liability.

 

[Kane]

Buying a car is not just about whether you can pay for the car or not, it is also about maintenance. It is about whether you can pay for the gas and other maintenance.

 

[Kunkun]

Then it would depend on the purpose of buying the car in the first place, because of put to use in order to make returns then it's asset but if bought for personal gains or pleasure then it's a liability

 

[Heatman]

Buying a car is not just about whether you can pay for the car or not, it is also about maintenance. It is about whether you can pay for the gas and other maintenance.

exactly you have a very good point because it's actually work my father used to tell me that buying a car is not a problem but actually being able to maintain the car on the long run is where the problem lies.

 

[Bookwormlux1]

As an entrepreneur, you only use your Profits to buy a car as it is a liability. You should not use money that you have been saving to purchase a car. It doesn't make sense at all.