Section 3

Departmentalization SECTION 3 ACCOUNTS 8500-8900 PRORATION OF UNAPPLIED EXPENSES OTHER INCOME & DEDUCTIONS ACCOUNTS 8500-8900 Allocate used car lot lighting costs to the used vehicle department. In the absence of more precise methods, all other costs may be distributed on the basis of unweighted square footage within the building(s). Utility expense applicable to square footage Read more about Section 3[…]

Section 2

Departmentalization SECTION 2 RENT AND RENT EQUIVALENT BUILDING LAND SUMMARY RENT AND RENT EQUIVALENT Account 8300, Rent & Lease Expense Account 8320, Interest—Mortgage Account 8340, Depreciation—Building & Improvements Account 8360, Amortization of Leasehold Improvements Account 8380, Insurance—Buildings Account 8400, Taxes—Real Estate Account 8420, Maintenance—Buildings First distribute each item of these expenses that can be identified Read more about Section 2[…]

Section 1

Departmentalization SECTION 1 MANAGEMENT CONTROL SYSTEM DEPARTMENTALIZED ACCOUNTING SYSTEM FIXED EXPENSE ALLOCATING FIXED EXPENSES ACCOUNTS 8000-8240 MANAGEMENT CONTROL SYSTEM Departmentalized accounting, often referred to as profit centering, is a system whereby profits are determined for departments of “centers” within the dealership. The intent of such a system in an automobile dealership, as in any business, Read more about Section 1[…]