071 Memberships, Dues and Publications

Expenses

Semi-Fixed

Synopsis

Account 071, Memberships, Dues and Publications is established to record the cost of belonging to trade organizations and subscribing to various trade journals.

Debits

Credits

Cost of Business Accounting Managers (BAM) Council Program
Cost of Memberships in and Dues of organizations for business purposes
Cost of dealer associations dues
Cost of Used Vehicle Guidebooks
Cost of subscriptions to magazines, newspapers, etc.
Cost of parts price catalogs

Example 1

Record the invoice of $198 for the New and Used Sales Managers’ subscriptions to Automotive News.

Journal: Cash Disbursements and Purchase

Entry:		Debit	Credit
Account 071-01	Memberships, Dues and Publications – New Vehicles Department	$99
Account 071-02	Memberships, Dues and Publications – Used Vehicles Department	$99
Account 300	Accounts Payable – Trade Creditors		$198

Example 2

Record the cost of the membership to the Parts and Service Clubs for the Service and Parts managers for $250.

Journal: Cash Disbursements

Entry:		Debit	Credit
Account 071-05	Memberships, Dues and Publications – Mechanical Department	$125
Account 071-07	Memberships, Dues and Publications – Parts & Accessories Department	$125
Account 202	Cash in Bank		$250

Distribution of Expenses

	Departmental Distribution
071 Membership Dues & Publications	New Veh.	Used Veh.	Lease & Rental	Mechanical	Body Shop	Parts & Access.	Gen & Admin.
	01	02	03	05	06	07	09
Dealer association dues							Total expense
Publications for service department waiting room				Usage	Usage
Parts merchandising publications						Total expense
Publications for general use							Total expense
Business Accounting Managers (BAM) Council Program							Total expense
Membership dues	Employees participating	Employees participating	Employees participating	Employees participating	Employees participating	Employees participating	Employees participating
Parts price catalogs						Total expense

Comments

Publications such as parts price catalogs, and technical shop manuals are requirements for maintaining a highly efficient dealership. Belonging to local civic organizations such as the chamber of commerce or various state and national dealer organizations has intangible benefits for the dealership. All Membership Dues and fees should be recorded in this account. Similarly, trade journals and other automotive magazines may be essential sources of information to supplement on-the-job training for key employees.

Expenses for Memberships, Dues and various Publications should be charged to the Department, which incurs the expense as indicated in the Expense Distribution table above. In the case where more than one Department benefits, then the expenditure should be pro-rated between Departments.

Whenever Memberships, Dues and Publications are paid in advance, the expenditure should be recorded in Account 274, Prepaid Other. The monthly provision to expense the Prepaid amount is debited to this account and credited to Account 274, Prepaid Other.

Note:

Professional tax and accounting advice should be obtained regarding the income tax deductibility of certain professional and social memberships.

Departmental Distribution