Inventory—Used SUV/Trucks—Other Franchise – Ford Online Accounting Manual

Assets

INVENTORY—USED SUV/TRUCKS—OTHER FRANCHISE		ASSET ACCOUNT
		1370

ACCOUNT EXPLANATION
TRANSACTIONS
COMMENTS

ACCOUNT EXPLANATION

Used SUV/Trucks Other Franchise held for resale valued at the lower of cost or estimated wholesale value. Cost includes reconditioning charges.

TRANSACTIONS

			Jrnl.	Dr.	Cr.

Used SUV/Trucks Other Franchise taken in trade on new SUV/Truck sale			NV
	Inventory—Used SUV/Trucks Other Franchise			1370
		Sales—New Light SUV/Trucks—Retail & Fleet			3400- etc.

Reconditioning work performed on used SUV/Truck			I
	Inventory—Used SUV/Trucks—Other Franchise			1370
		Sales—Parts to Service—Internal (at internal rate)			5471
		Sales—Parts to Body Shop—Internal (at internal rate)			5531
		Sales—Service Labor—Internal (at internal rate)			5731
		Sales—Body Shop Labor—Internal (at internal rate)			5841

Costing used SUV/Truck sold at retail			UV
	Cost of Sales—Used SUV/Trucks—Retail			4767
	Cost of Sales—Used SUV/Trucks—Reconditioning—Retail			4768
		Inventory—Used SUV/Trucks—Other Franchise			1370

Repossessed SUV/Truck (originally sold as a new truck) purchased from finance company			CD
	Inventory—Used SUV/Trucks—Other Franchise (at estimated wholesale value less estimated reconditioning)			1370
	Repossession Purchase Loss—New (excess of purchase price)			6070
	or			or
	Estimated Liability for Repossession Purchase Loss			2600
		Cash in Bank—General			1001

Purchase of vehicle and return of security deposit and deferred gross from F.M.C.C. at end of Lease Term			CD
	Inventory—Used SUV/Trucks—Other Franchise			1370
		Accounts Receivable—F.M.C.C.—Deferred Gross			1836
		Customer Deposits			2300
		Cash in Bank—General			1001

Write down value of vehicle purchased from F.M.C.C. to current wholesale value			GJ
	Income from sale of Lease Contracts, SUV/Trucks, Maintenance/Non-Maintenance			5318, 5320
		Inventory—Used SUV/Trucks—Other Franchise			1370

COMMENTS

Used SUV/Trucks should be placed in inventory at estimated wholesale value, less estimated reconditioning required to make the vehicle saleable at the estimated wholesale value. When repossessed units are placed in inventory, the excess of purchase price over estimated wholesale value should be charged to Account 2600, Estimated Liability for Repossession Purchase Loss. If Account 2600 is not used, the excess should be charged to Account 6070, Repossession Purchase Loss—New, or Account 6170, Repossession Purchase Loss—Used, depending on whether the sale that led to the repossession was a new vehicle sale or a used vehicle sale.
Subsidiary records should support this account. At month end, used SUV/Trucks should be physically inventoried and their total value reconciled with the balance in this account. An aging schedule of used SUV/Trucks on hand should be prepared for management review.
If at month end, the amount at which a unit is carried in inventory exceeds its current estimated wholesale value, the excess amount should be credited to this account and charged to Account 4752, Used Trucks—Inventory Adjustments.
Auction fees incurred on purchase of used SUV/Trucks should be charged to this account.
An inventory numbering system, providing cross-reference to the new vehicle source where applicable, should be used. See Office Management for details.
Units sold as junkers should be recorded as wholesale sales.
For financial statement purposes Account 1836, Accounts Receivable F.M.C.C.—Deferred Gross, should be combined with Account 1830, Other Assets.