955 Other Deductions

Additions/Deductions

Deductions from Income

Synopsis

Account 955 is established to record miscellaneous losses, expenses or deductions, which cannot properly be recorded in any other account.

Debits

Credits

Life insurance premiums paid on the lives of owners
Excess of the premium paid over the increase in the cash surrender value of life insurance policies owned by the dealership
Losses on sales of fixed assets, securities, miscellaneous assets received in trade and other investments and miscellaneous assets
Write – off of organization expense
Moving expense
Fees and commissions paid brokers and others for arranging capital loans, mortgages, etc.
Casualty losses
Writedown of securities to market value
Notes and accounts in Account 294, Notes & Accounts Receivable - Other considered uncollectible
Other non – operating deductions for which no provision has been made

Example 1

Record the $1,500 write-down of the securities held for temporary investment to market value.

Journal: General Journal

Entry:		Debit	Credit
Account 955	Other Deductions	$1,500
Account 260	Securities		$1,500

Example 2

Record the write-off of landscaping with a book value of $12,550 that was destroyed by the snow storm. The dealership owns the building & improvements. The cost of the landscaping is $18,364 and the accumulated depreciation is $5,814.

Journal: General Journal

Entry:		Debit	Credit
Account 351	Accumulated Depreciation – Buildings & Improvements	$5,814
Account 955	Other Deductions	$12,550
Account 281	Buildings & Improvements (Auto Business Only)		$18,364