LIFO Adjustments—Used Vehicles – Ford Online Accounting Manual

Sales and Cost of Sales

LIFO ADJUSTMENTS—USED VEHICLES	ASSET ACCOUNT
	6250

The difference between the Actual Cost (FIFO) and LIFO method of new vehicle valuation should be recorded in this account.

*Refer to Chart of Accounts for current applicable Sales/Cost of Sales account numbers

			Jrnl.	Dr.	Cr.

Reflect the difference between the Actual Cost (FIFO) method and the LIFO method of valuing the used vehicle adjustments			GJ
	LIFO Inventory Reserve—Used Vehicles				1480
		Cost of Sales Adjustment—LIFO—Used Vehicles		6200

NOTE: Accounts 1481-1489 are available if additional reserve accounts for used vehicles are required.

ANY DECISION TO ADOPT THE LIFO METHOD OF INVENTORY VALUATION AND ANY PROCEDURES ADOPTED FOR ACCOUNTING AND FINANCIAL REPORTING UNDER LIFO SHOULD BE MADE WITH THE ADVICE OF COMPETENT TAX COUNSEL.

NOTE:

For LIFO dealers, working capital must be calculated as follows:
“Current Assets plus LIFO Reserve minus Current Liabilities“