460D Mobile Service Labor – Cars & Light Duty Trucks
Sales
Fixed Operations
Sales Synopsis
Account 460D is established to record Labor sales paid by Customers for Mobile Service Labor performed by Mobile Service vehicles.
Debits |
Credits |
|
a. Lube, oil & Filter (LOF) b. Tire rotation c. Routine inspections
|
660D Mobile Service Labor – Cars & Light Duty Trucks
Cost of Sales
Fixed Operations
Cost of Sales Synopsis
Account 660D is established to record the Cost of Sales for Mobile Service Labor, which is defined as compensation paid to technicians, for customer paid Mobile Service Mechanical Labor.
Debits |
Credits |
|
|
Example 1
Record customer repair order for a lube, oil & filter in the amount of $60 performed by a Mobile Service vehicle. The mobile service labor sale is $20. The shop supplies are $10, the parts sale is $15, the gas, oil and grease sales are $15 and the sales tax is $4. The labor cost is $7. The shop supplies cost is $4, the parts cost is $10 and the gas, oil and grease cost is $11.
Journal: Service Sales - Cash
Entry: |
|
Debit |
Credit |
Account 225 |
Cash Sales |
$60 |
|
Account 660D |
Cost of Sales – Mobile Service Labor – Cars & Light Duty Trucks |
$7 |
|
Account 669 |
Cost of Sales – Shop Supplies |
$4 |
|
Account 667D |
Cost of Sales – Parts – Mobile Service – Repair Orders |
$10 |
|
Account 691 |
Cost of Sales – Gas, Oil & Grease |
$11 |
|
Account 244 |
Inventory – Gas, Oil & Grease |
|
$11 |
Account 242 |
Inventory – Parts & Accessories |
|
$10 |
Account 247A |
Inventory – Work in Process – Mechanical |
|
$7 |
Account 460D |
Sales – Mobile Service Labor – Cars & Light Duty Trucks |
|
$20 |
Account 469 |
Sales – Shop Supplies |
|
$10 |
Account 467D |
Sales – Parts – Mobile Service – Repair Orders |
|
$15 |
Account 491 |
Sales – Gas, Oil & Grease |
|
$15 |
Account 324 |
Sales Taxes Payable |
|
$4 |
Comments
If the dealership has a Mobile Service Vehicle, then all Mechanical Labor performed by the Mobile Service Technicians should be recorded in these accounts.
Note:
It is recommended that whenever practicable labor sales be costed on actual basis because material losses of productive time may be concealed by the inaccuracies inherent in percentage costing methods. Such inaccuracies can result from failure to update costing percentages when changes occur in the compensation of technicians and in the structural of selling prices of labor, and other reasons.
Assure that Repair Order templates, and accounting are set up correctly by the DSP and maintained whenever technicians have payroll changes. Technician incentives or bonuses should be considered cost of labor sales and debited to A/C 665 and 675 as applicable. However, holiday, vacation, and sick pay should not be charged to Cost of Labor Sales, but as a non-productive wage expense in A/C 24 - Absentee Compensation.
Before closing each month, assure that the balance in A/C 247 - Work in Process, matches the total cost of labor on open (unclosed) R.O.'s, any difference should be adjusted to A/C 665 or 675 - Labor Adjustment.