718 Other (Closed End Lease)

728 Other (Open End Lease)

738 Other (Rental)

Lease & Rental Activity

Direct Cost

Cost of Sales Synopsis

Accounts 718, 728, and 738, Other Direct Costs for Closed End Lease, Open End Lease and Rental vehicles, respectively are established to record the cost of miscellaneous Direct Costs, which cannot be properly classified in any other account, related to operating Lease and Rental vehicles.

Debits

Credits

  1. Miscellaneous Direct Costs associated with the operation of Lease and Rental vehicles including:

a.      Gasoline

b.      Collection fees for late payments

 

 

Example 1

Record the monthly expense of gasoline on rental units in the amount of $3,987.

Journal: Cash Disbursements and Purchases

Entry:

 

Debit

Credit

Account 738

Direct Cost – Other (Rental)

$3,987

 

Account 300

Accounts Payable – Trade Creditors

 

$3,987