282 Machinery and Shop Equipment
Assets
Fixed
Synopsis
Account 282 is established to record the acquisition cost of Machinery and Shop Equipment purchased by the dealership and used in the automobile business.
Debits |
Credits |
|
|
Example 1
Record the purchase of a tire machine in the amount of $8,750.
Journal: Cash Disbursements and Purchase
Entry: |
|
Debit |
Credit |
Account 282 |
Machinery & Shop Equipment |
$8,750 |
|
Account 202 |
Cash in Bank |
|
$8,750 |
Example 2
Record the disposal of obsolete diagnostic equipment in the amount of $5,000. The accumulated depreciation of the Machinery is $3,438 and the amount of Other Deductions is $1,562.
Journal: General Journal
Entry: |
|
Debit |
Credit |
Account 352 |
Accumulated Depreciation – Machinery & Shop Equipment |
$3,438 |
|
Account 955 |
Other Deductions |
$1,562 |
|
Account 282 |
Machinery & Shop Equipment |
|
$5,000 |
Comments
A debit balance represents the cost of machinery, permanent tools and equipment acquired and built for the use in the service department. This includes items of a moveable nature, not a permanent part of the building such as:
a. Benches
b. Cabinets
c. Hoists
d. Overhead racks
e. Tool racks
f. Jacks
g. Diagnostic equipment
Note:
ONLY ASSETS USED IN THE OPERATION OF THE DEALERSHIP BUSINESS SHOULD BE INCLUDED IN THESE ACCOUNTS.
Cost of assets should include additional items such as: