Automotive & Dealerships Knowledge Center
Explore our verified library of Automotive & Dealerships transactions. Every entry is reviewed for IFRS compliance and real-world accuracy by our technical accounting team.
New Vehicle Sale — Cash / Finance Customer
Recording the sale of a new vehicle to a retail customer paying cash or arranging third-party financing.
Used Vehicle Sale — Retail Customer
Recording the sale of a pre-owned vehicle from the dealership's used car lot.
Trade-In Vehicle Received
Recording the acquisition of a customer's trade-in vehicle as part of a new or used vehicle deal.
Manufacturer Holdback and Dealer Incentive
Recording the holdback credit and retail sales incentive received from the vehicle manufacturer.
F&I Revenue — Finance Reserve and Insurance Products
Recording revenue from Finance & Insurance products sold in conjunction with a vehicle sale.
Fixed Operations — Service Labor Revenue
Recording labor revenue from customer-pay and warranty service work completed in the dealership's service department.
Warranty Repair — OEM Reimbursement
Recording the labor and parts revenue earned from the manufacturer for completing warranty repairs.
Parts Department — Retail and Wholesale Parts Sale
Recording the sale of OEM and aftermarket parts to retail customers and wholesale accounts.
Vehicle Inventory Floor Plan — New Vehicle Financing
Recording the floor plan loan drawn when a new vehicle is received from the manufacturer.
Floor Plan Interest Expense
Recording monthly interest accrued on the vehicle floor plan loan.
Demo Vehicle — Transfer from Inventory to PPE
Reclassifying a new vehicle from inventory to a demonstrator (demo) vehicle used for test drives and management use.
Used Vehicle Reconditioning Cost
Capitalizing the cost of mechanical repairs, detailing, and parts into a used vehicle's inventory cost.
Wholesale Vehicle Disposal — Auction or Dealer-to-Dealer
Recording the sale of excess used inventory at auction or to another dealer below retail.
Vehicle Lease — Dealer-Facilitated Finance Lease
Recording the dealership's revenue when a customer leases a vehicle arranged through the manufacturer's captive finance company.
Rental / Loaner Fleet Vehicle — Capitalisation and Depreciation
Recording the cost of a courtesy loaner vehicle assigned to the service department fleet.
Manufacturer Chargeback — Warranty Claim Rejection
Recording the reversal of previously recognized warranty revenue when a manufacturer rejects a warranty claim.
CSI Bonus — Manufacturer Customer Satisfaction Incentive
Recording the bonus received from the manufacturer for achieving customer satisfaction index (CSI) targets.
Fixed Operations Absorption — Overhead Coverage
Demonstrating the fixed operations gross profit covering dealership overhead (absorption).
Body Shop — Collision Repair Revenue
Recording revenue from collision repair work performed in the dealership's body shop.
Salesperson and Manager Pay Plan — Commission Accrual
Accruing monthly sales commissions and bonuses for vehicle salespeople, F&I managers, and service advisors.
Manufacturer Co-Op Advertising Funds
Recording dealer advertising co-op funds earned from the manufacturer for qualifying advertising spend.
New Vehicle Inventory NRV Write-Down
Writing down new vehicle inventory to net realizable value when market prices fall below cost.
Dealer Franchise Agreement — Intangible Asset
Recording the value of an automotive franchise right acquired in a dealership purchase transaction.
Vehicle Service Contract Reserve — Dealer-Obligor VSC
Accruing the warranty reserve for future claims on dealer-obligated vehicle service contracts.
F&I Finance Reserve Chargeback — Early Loan Payoff
Recording the clawback of dealer finance reserve when a customer pays off their auto loan early.
Manufacturer Statement Reconciliation — Dealer Account
Reconciling the dealer's open payables and receivables with the manufacturer's monthly dealer account statement.
Dealer Group — Intercompany Elimination (Multi-Rooftop)
Eliminating intercompany transactions between dealership points in a multi-rooftop dealer group.
Flat-Rate Technician Payroll
Recording technician wages based on flat-rate hours flagged on completed repair orders.
EOSB Provision — Dealer Staff (Jordan)
Accruing end-of-service benefits for Jordanian automotive dealership employees.
SSC Employer Contribution — Dealer Staff (Jordan)
Recording the 14.25% employer SSC for Jordanian dealership employees.
GST on New Vehicle Sale (Jordan 16%)
Recording General Sales Tax collected from the customer on new vehicle sales in Jordan.
Import Duty on Imported Vehicles
Recording customs duties and import fees on new vehicles imported from overseas manufacturers.
Vehicle Delivery Preparation Expense
Recording the cost of preparing a new vehicle for customer delivery (PDI — Pre-Delivery Inspection).
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