October 30, 2016 admin

Parts—Counter Retail

Sales and Cost of Sales

PARTS—COUNTER RETAIL ACCOUNT
SALES   5420/5421/5422
COST OF SALES   6420/6421/6422

ACCOUNT EXPLANATION

Sales: Selling price of parts sold over the counter to retail customers and employees.

Cost of Sales: Inventory value of above parts sold.

NOTE: Dealers with competitive franchises (Non FoMoCo) separate parts and report FoMoCo (franchise) parts in Account 5420/6420 and Non FoMoCo (other franchises) in Account 5421/6421. (QL/FL/QCSC) Parts in Accounts 5422/6422.

*Refer to Chart of Accounts for current applicable Sales/Cost of Sales account numbers
TRANSACTIONS
  Jrnl. Dr. Cr.
  Parts sold to retail customer on open account PS
    Accounts Receivable—Parts 1120
      Sales—Parts—Counter Retail—Franchise Only 5420
      Sales—Parts—Counter Retail—Non Franchise Only     5421
      Sales—Parts—Counter Retail—QL/FL/QCSC     5422
  Parts sold to retail customer for cash PS
    Cash Sales—Clearing 1010
      Sales—Parts—Counter Retail—Franchise Only 5420
      Sales—Parts—Counter Retail—Non Franchise Only     5421
      Sales—Parts—Counter Retail—QL/FL/QCSC     5422
             
  Parts costed out at time of sale PS
    Cost of Sales—Parts—Counter Retail—Franchise Only 6420
    Cost of Sales —Parts—Counter Retail—Non Franchise Only 6421
    Cost of Sales —Parts—Counter Retail—QL/FL/QCSC 6422
      Inventory—Parts—Ford/Other/QL/FL/QCSC 1400,
1410,
1406 
COMMENTS
  • It is recommended that parts sales be costed on an item-by-item basis at the time of sale, since this method produces the most accurate cost of sales data and provides the best control of inventory. If parts sales are costed on the basis of estimated percentages of retail selling prices in various inventory categories at month end, percentages used should be verified by test checks of actual item costs over a 30-60 day period every six months. Office Management contains additional information on costing methods.