What would be the Journal Entries for a Used Car Dealership?
To record the purchase of a vehicle at auction?
Debit: Inventory Vehicle-Cost Price
Credit: Cash-Cost Price
To record the sale of a vehicle on account? The dealership charges interest.
Debit: Cash-Customer Deposit
Debit: Accounts Receivable-Sales Price (remainder of)
Debit: Accounts Receivable-Interest to be paid in the future
Credit: Income-Sale of Vehicle (Sale Price)
Credit: Income-Interest of Vehicle Sale Price
To record Sales Tax?
Debit: Cash-Sales Tax (6% of Sale Price)
Credit: Sales Tax Payable (6% of Sale Price)
To adjust Inventory and COGS at time of Vehicle Sale?
Debit: COGS-Vehicle
Credit: Inventory-Vehicle
To record customer's payment to the dealership?
Debit: Cash
Credit: Accounts Receivable-Sales Price
Credit: Accounts Receivable-Interest
Let me know if I am missing something or if I need to rearrange accounts etc.
Thank-you,
To record the purchase of a vehicle at auction?
Debit: Inventory Vehicle-Cost Price
Credit: Cash-Cost Price
To record the sale of a vehicle on account? The dealership charges interest.
Debit: Cash-Customer Deposit
Debit: Accounts Receivable-Sales Price (remainder of)
Debit: Accounts Receivable-Interest to be paid in the future
Credit: Income-Sale of Vehicle (Sale Price)
Credit: Income-Interest of Vehicle Sale Price
To record Sales Tax?
Debit: Cash-Sales Tax (6% of Sale Price)
Credit: Sales Tax Payable (6% of Sale Price)
To adjust Inventory and COGS at time of Vehicle Sale?
Debit: COGS-Vehicle
Credit: Inventory-Vehicle
To record customer's payment to the dealership?
Debit: Cash
Credit: Accounts Receivable-Sales Price
Credit: Accounts Receivable-Interest
Let me know if I am missing something or if I need to rearrange accounts etc.
Thank-you,