454 GM Protection Plans – Used Vehicles (Sales)
Finance & Insurance Activity
Used Vehicle
Sales Synopsis
Account 454 is established to record the Sales of GM Protection Plans on Used Vehicles, by the F & I Department.
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Debits |
Credits |
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654 GM Protection Plans – Used Vehicles (Cost of Sales)
Finance & Insurance Activity
Used Vehicle
Cost of Sales Synopsis
Account 643 is established to record the Cost of Sales of GM Protection Plans sold on Used Vehicles.
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Debits |
Credits |
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Example 1
Record the sale of an Other Used Car in the amount of $17,076 that has a sale of a GM Protection Plan for $1,500. The car was paid partly with a $15,877 finance contract and $4,000 from the trade-in. The finance contract reserve is $853, sales tax is $876, insurance commissions earned from the sale of a GAP insurance policy are $150 and Registration Fees are $125. The inventory value of the used vehicle sold is $15,876 of which $876 is due to Reconditioning. The cost of the GM Protection Plan is $950 and the cost of the GAP insurance policy is $150.
Journal: Used Car Sales
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Entry: |
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Debit |
Credit |
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Account 205 |
Contracts in Transit |
$15,877 |
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Account 262 |
Due from Finance Companies |
$853 |
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Account 646B |
Cost of Sales – Used Cars Retail – Other |
$15,000 |
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Account 647B |
Reconditioning – Used Cars Other |
$876 |
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Account 654 |
Cost of Sales – GM Protection Plans – Used Cars |
$950 |
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Account 240 |
Inventory – Used Cars |
$4,000 |
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Account 446B |
Sales – Used Cars Retail – Other |
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$17,076 |
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Account 454 |
Sales – GM Protection Plans – Used Cars |
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$1,500 |
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Account 240 |
Inventory – Used Cars |
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$15,876 |
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Account 300 |
Accounts Payable – Trade Creditors |
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$950 |
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Account 300 |
Accounts Payable – Trade Creditors |
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$150 |
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Account 324A |
Sales Taxes Payable – Excise Taxes |
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$876 |
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Account 808 |
Finance Income – Used |
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$853 |
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Account 809 |
Insurance Commissions Earned – Used Cars |
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$150 |
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Account 910 |
Document Handling Fees |
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$125 |