October 30, 2016 admin

Parts—Repairs Shop

Sales and Cost of Sales

PARTS—REPAIR SHOP ACCOUNT
SALES   5430/5431/5435/5436
COST OF SALES   6430/6431/6435/6436

ACCOUNT EXPLANATION

Sales: Selling price of parts installed in dealer’s repair shop and sold to customers on completed repair orders, including fleet owners, insurance companies and vehicles damaged in transit, as well as to individual vehicle owners.

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 5430/6430 and Non FoMoCo (other franchises) in Account 5431/6431.

*Refer to Chart of Accounts for current applicable Sales/Cost of Sales account numbers
TRANSACTIONS
  Jrnl. Dr. Cr.
  Parts sold on service department repair order for cash PS
    Cash Sales—Clearing 1010
      Sales—Parts—Repair Shop Franchise/Non Franchise 5430, 5431
      Sales—Parts—Repair Shop Franchise/Non Franchise 5510, 5511
      Sales—Parts—Repair Quick Lane     5435
      Sales—Parts—Repair Quick Lane Tires     5436
             
  Parts costed out at time of sale PS
    Cost of Sales—Parts—Repair Shop Franchise/Non Franchise 6430, 6431
    Cost of Sales—Parts—Repair Shop Quick Lane 6435
    Cost of Sales—Parts—Repair Shop Quick Lane Tires 6436
             
  Sale and costing of parts sold to fleet owner on shop repair order on open account PS
    Accounts Receivable—Parts 1120
    Accounts Receivable—Service 1121
      Sales—Parts—Repair Shop Franchise/Non Franchise 5430, 5431
      Sales—Parts—Repair Shop Quick Lane 5435
      Sales—Parts—Repair Shop Quick Lane Tires 5436
    Cost of Sales—Parts—Repair Shop Franchise/Non Franchise   6430, 6431
    Cost of Sales—Parts—Repair Shop Quick Lane   6435
    Cost of Sales—Parts—Repair Shop Quick Lane Tires   6436
      Inventory—Parts—Ford/Other     1400,1410
      Inventory—Parts—Quick Lane/Tires     1405,1406
           
  Parts sold on repair of vehicles damaged in transit PS  
    Ford Receivable—Other   1200
      Sales—Parts—Repair Shop Franchise/Non Franchise     5430, 5431
      Sales—Parts—Repair Shop Quick Lane     5435
      Sales—Parts—Repair Shop Quick Lane Tires     5436
             
  Parts costed out at time of repair of vehicles damaged in transit PS    
    Cost of Sales—Parts—Repair Shop Franchise/Non Franchise   6430, 6431  
    Cost of Sales—Parts—Repair Shop Quick Lane   6435  
    Cost of Sales—Parts—Repair Shop Quick Lane Tires   6436  
      Inventory—Parts—Ford/Other     1400, 1410
      Inventory—Parts—Quick Lane/Tires     1405,1406
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.
  • Parts damaged in transit may be recorded in the Parts and Service Sales Journal.