480 Parts Warranty Claims

Sales

Fixed Operations

Sales Synopsis

Account 480 is established to record the sales of Parts sold on Warranty and Transportation Claims.

Debits

Credits

Actual selling price (at claim rate) of Parts for which Warranty and Transportation Claims are filed

680 Parts Warranty Claims

Cost of Sales

Fixed Operations

Cost of Sales Synopsis

Account 680 is established to record the Cost of Sales for the Parts sold in Account 480 above.

Debits

Credits

Cost of Parts for which Warranty and Transportation Claims are filed

Example 1

Record a $755 warranty repair order for a customer’s car. The warranty claim labor sale is $170 and the warranty claim parts sale is $585. The warranty claim cost of labor is $50 and the warranty claim cost for parts is $450.

Journal: Warranty Sales

Entry:		Debit	Credit
Account 263	Accounts Receivables – Warranty Claims	$755
Account 662	Cost of Sales – Warranty Claim Labor – Mechanical	$50
Account 680	Cost of Sales – Parts – Warranty Claims	$450
Account 242	Inventory – Parts & Accessories		$450
Account 247A	Inventory – Work in Process – Mechanical		$50
Account 462	Sales – Warranty Claim Labor – Mechanical		$170
Account 480	Sales – Parts – Warranty Claims		$585