October 30, 2016 admin

Commissions & Incentives—Managers—Service

Expenses

COMMISSIONS & INCENTIVES—MANAGERS—SERVICE EXPENSE ACCOUNT
7705/7905

ACCOUNT EXPLANATION
Commissions and incentives paid or accrued to service department managers on the sale of service labor or other items sold by the service department. Includes incentives based on the performance of the service department.
TRANSACTIONS
  Jrnl. Dr. Cr.
  Commission earned by service managers on service sales PR
    Commissions & Incentives—Managers—Service 7705
    Commissions & Incentives—Managers—Service—Quick Lane 7905  
      Accrued Payroll 2410
             
  Incentive pay earned by service managers on the customer satisfaction rating of the service department PR
    Commissions & Incentives—Managers—Service 7705
    Commissions & Incentives—Managers—Service—Quick Lane 7905  
      Accrued Payroll 2410
COMMENTS
  • Guaranteed minimum commissions paid but not earned through service sales should be charged to Account 7710, Salaries—Other—Service.
  • Bonuses based on total dealership profit should be charged to Account 9550, Employee Bonuses.
  • Commissions, incentives, prizes, etc., paid to dealership employees are subject to withholding and should be recorded through the Payroll Journal. Tax counsel should be consulted as necessary.
  • See also Account 7805, Commissions & Incentives—Managers—Body Shop.