484 Accessories

Sales

Fixed Operations

Sales Synopsis

Account 484 is established to record the sales of Accessories sold by the Parts & Accessories Department.

Debits

Credits

  1. The amount of Accessories returned by customers for re-stocking

  1. The selling price of Accessories sold by the Parts and Accessories Department including sales on:

a.   Customer Repair Orders

b.   Warranty Claim sales at the claim rate

c.   Internal sales at the Internal rate

d.   Counter Retail

e.   Wholesale

 

Comments

It is recommended that the Internal sales of regularly stocked parts and accessories, other than parts and accessories sold on customer repair orders, be priced at COST PLUS 25%, but not to exceed the retail selling price of the item.

If preferred, a rate sufficient to cover the prime cost of the parts and accessories plus a pro rata share of the parts and accessories department overhead may be used for all internal sales.  To determine this rate, the steps below should be followed:

 

EXAMPLE

 

  • Estimated annual fixed overhead expense of the parts and accessories department

$48,000

  • Estimated annual amount of the parts and accessories department cost of sales

/ $185,000

  • Percentage Mark-up

26%

 

The internal selling price of parts and accessories equals cost plus 26%.

684 Accessories

Cost of Sales

Fixed Operations

Cost of Sales Synopsis

Account 684 is established to record the Cost of Sales of Accessories sold in Account 484 above.

Debits

Credits

  1. The cost of Accessories sold

 

 

Example 1

Record the sale of mats to a customer for $100.  The accessory sale is $95 and sales tax is $5.  The accessory cost is $55.

Journal: Parts Sales - Cash

Entry:

 

Debit

Credit

Account 225

Cash Sales

$100

 

Account 684

Cost of Sales – Accessories

$55

 

Account 242

Inventory – Parts & Accessories

 

$55

Account 324

Sales Taxes Payable

 

$5

Account 484

Sales – Accessories

 

$95