082 Repairs - Real Estate

082 Repairs – Real Estate

Expenses

Fixed

Synopsis

The cost of making repairs (as opposed to making improvements) is recorded in Account 082, Repairs – Real Estate. Professional tax and accounting advice should be obtained regarding the classification of repairs versus improvements.

Debits

Credits

Cost of maintaining and Repairing Real Estate whether owned or leased

Example 1

Record the cost of $635 for the repairs to the garage door in the service lane.

Journal: Cash Disbursements and Purchase

Entry:		Debit	Credit
Account 082-05	Repairs – Real Estate – Mechanical Department	$635
Account 300	Accounts Payable – Trade Creditors		$635

Distribution of Expenses

	Departmental Distribution
082 Repairs – Real Estate	New Veh.	Used Veh.	Lease & Rental	Mechanical	Body Shop	Parts & Access.	Gen & Admin.
	01	02	03	05	06	07	09
General repairs, painting, etc., to the main building (not capitalized)	Relative value factor	Relative value factor	Relative value factor	Relative value factor	Relative value factor	Relative value factor	Relative value factor
Plumbing repairs in the body shop					Total expense
Replace broken window in the showroom	Total expense
Minor repairs to the used car lot blacktop		Total expense
Painting of the general office area							Total expense

Comments

When repairs to the dealership facility (real estate) are performed for a single Department, then the expense should be charged to the department. When more than one Department benefits from a repair, then the expense should be pro-rated according the Expense Distribution table above.

Note:

Not included in this account are costs related to Improvements to real estate owned by the dealership, which are properly recorded in Account 083, Depreciation – Buildings and Improvements.

Departmental Distribution