090 Repairs - Equipment

Expenses

Fixed

Synopsis

Account 090, Repairs – Equipment is established to record the cost of performing repairs on equipment owned by the dealership and used in the auto business. The monthly provision for equipment service contracts is also posted to this account.

Debits

Credits

Cost of maintaining and Repairing Equipment other than company owned vehicles

Example 1

Record the cost of repairing a lift in the mechanical shop in the amount of $459.

Journal: Cash Disbursements and Purchase

Entry:		Debit	Credit
Account 090-05	Repairs – Equipment – Mechanical Department	$459
Account 300	Accounts Payable – Trade Creditors		$459

Example 2

Record the monthly expense of $350 for the maintenance contract on the copier machine.

Journal: Standard Journal

Entry:		Debit	Credit
Account 090-09	Repairs – Equipment – General & Administrative	$350
Account 274	Prepaid Expenses - Other		$350

Distribution of Expenses

	Departmental Distribution
090 Repairs - Equipment	New Veh.	Used Veh.	Lease & Rental	Mechanical	Body Shop	Parts & Access.	Gen & Admin.
	01	02	03	05	06	07	09
Repairs to body shop equipment					Total expense
Repairs to parts bins						Total expense
Maintenance contract on equipment	Equipment covered	Equipment covered	Equipment covered	Equipment covered	Equipment covered	Equipment covered	Equipment covered
Maintenance contract on service department lifts				Equipment covered	Equipment covered
Repair copying machine used in the general office							Total expense
Repairs to general office equipment							Total expense
Repairs to rented vehicles in company service (other than lease and rental units)	Vehicles assigned	Vehicles assigned	Vehicles assigned	Vehicles assigned	Vehicles assigned	Vehicles assigned	Vehicles assigned

Comments

The cost of repairs and maintenance contracts are debited to this account. When a repair is done for the benefit a single Department, the entire cost of the repair should be charged to the Department. When two (2) or more Departments are involved, the expense should be pro-rated to each respective Department based on usage as indicated in the Expense Distribution table above.

Departmental Distribution