October 30, 2016 admin

New Cars—Retail Sales

Sales and Cost of Sales

NEW CARS—RETAIL SALES ACCOUNT
SALES  3000-3340
COST OF SALES  4000-4340
ACCOUNT EXPLANATION

Sales: Selling price, less any discount or overallowance, of new cars sold at retail.

Cost of Sales: Inventory value of units sold. Note that inventory value is cost less vehicle holdback.

Extended Service Plan Contract.

*NOTE: a separate series of numbers has been assigned for retail leases. These lease numbers are paired with the retail sales numbers by changing the last digit of the sales number to 1:

Mustang—Retail Sales/Cost of Sales 3040, 4040
Mustang—Retail Lease/COS 3041, 4041
*Refer to Chart of Accounts for current applicable Sales/Cost of Sales account numbers
TRANSACTIONS
Jrnl. Dr. Cr.
New car sold at retail to customer for cash NV
Cash Sales—Clearing 1010
Sales—New Cars—Retail 3000, etc.
New car costed out at time of sale NV
Cost of Sales—New Cars—Retail 4000-
etc.
Inventory—New Cars 1300
Inventory—New Car—Other Franchise 1305
Sale of a new vehicle with an Extended Service Plan contract NV
Cash Sales—Clearing 1010
Sales and Use Taxes 2150
Customer Service Contracts 2315
Sales—New Vehicles 3000-
etc.
Service Contract Income—New 5040
COMMENTS
  • Ford Motor Company instructions set forth the account numbers for each car line within the above series of accounts. Accounting bulletins from the Company should be retained for reference in Section N of the paper manual.
  • Sales data should be entered on the subsidiary vehicle inventory record.
  • Gains or losses on new vehicles transferred to other dealerships should be recorded as decreases or increases in the Dealer Transfer Account 4640.
  • Dealerships that need to maintain records of gross dales and/or discounts and overallowances on vehicle sales may use one of two methods:
    1. Record gross sales and/or discounts and overallowances as memo items in the New Vehicle Sales Journal, without regard to vehicle line, or
    2. Establish a separate account, using numbers ending in 2 from the sales account numbers for each vehicle line (3002,3012,etc.), to which discounts and overallowances should be debited. Gross sales amounts should be credited to the vehicle sales accounts (3000,3010, etc.).