Liabilities and Net Worth
| NOTES PAYABLE—CERTIFIED VEHICLES (FRANCHISE ONLY) |
LIABILITY ACCOUNT |
| 2017 |
|
|
ACCOUNT EXPLANATION
|
| Principal amount of short term notes payable to finance institutions and secured by Certified vehicles (Franchise Only) in inventory. |
TRANSACTIONS
|
|
|
|
Jrnl. |
Dr. |
Cr. |
|
|
|
Receipt of floor plan note from bank on Certified vehicles (Franchise Only) |
|
CR |
|
|
|
|
Cash in Bank—General |
|
|
1001 |
|
|
|
|
Notes Payable—Certified vehicles (Franchise Only) |
|
|
|
2017 |
|
|
|
|
|
|
|
|
|
Payment of floor plan note on Certified vehicles (Franchise Only) |
|
CD |
|
|
|
|
Notes Payable—Certified vehicles (Franchise Only) |
|
|
2017 |
|
|
|
|
Cash in Bank—General |
|
|
|
1001 |
|
COMMENTS
|
- At month end, a listing should be made of the floor plan notes outstanding on used vehicles and the total reconciled with the balance in this account. A column on the used vehicle inventory schedule may serve as this listing.
- Interest charges on notes in this account should be recorded in Account 7380, Interest—Floor Plan—Used.
- Interest accrued at month end on outstanding floor plan notes should be credited to Account 2421, Accrued Interest.
- At the time a floor-planned used vehicle is sold, the floor plan note should be paid off.
|
