October 30, 2016 admin

Used Heavy Trucks—Retail Lease

Sales and Cost of Sales

USED HEAVY TRUCKS—RETAIL LEASE ACCOUNT
SALES   3875
COST OF SALES   4875

ACCOUNT EXPLANATION

Sales: Value of lease contracts, less any discounts or overallowances, of used heavy trucks leased to retail customers, usually under Red Carpet Lease Program.

Cost of Sales: Inventory value of units leased, excluding reconditioning costs, of used heavy trucks sold to lease customers.

*Refer to Chart of Accounts for current applicable Sales/Cost of Sales account numbers
TRANSACTIONS
  Jrnl. Dr. Cr.
  Sale of vehicle and assignment of Red Carpet Lease Plan to FMCC UV
    Accounts Receivable—FMCC Lease Plan 1135
    Accounts Receivable—FMCC Deferred Gross 1836
      Sales—Used Heavy Trucks—Retail Lease 3875
             
  Costing of sale of vehicle sold to FMCC UV
    Cost of Sales—Used Heavy Trucks—Retail Lease 4875
    Cost of Sales—Used Heavy Trucks—Reconditioning—Retail Lease 4876
      Inventory—Used Trucks 1360
COMMENTS
  • The cost of each vehicle and reconditioning costs should be obtained from the subsidiary vehicle inventory record. Sales data should be entered on the vehicle inventory record.
  • When used heavy trucks are leased, the inventory value, excluding reconditioning costs, of the units should be charged to Account 4875, Cost of Sales—Used Heavy Trucks—Retail Lease, and reconditioning costs should be charged to Account 4876, Cost of Sales—Used Heavy Trucks—Reconditioning Retail.
  • Dealers who need to maintain records of gross sales and/or overallowances on used vehicle sales may use one of two methods:
    1. Record gross sales and/or overallowances as memo items in the Vehicle Sales Journal, without regard to vehicle line, or:
    2. Establish a separate account using Account 3751, Used Trucks—Retail—Overallowances, to which overallowances should be debited. Gross sales amounts should be credited to Account 3875.