243 Tires

Assets

Inventories

Synopsis

Account 243 is established to record the inventory value of Tires on hand.

Debits

Credits

  1. The Cost of tires acquired, other than those purchased with new vehicles

  2. The replacement value of tires removed from new vehicles and placed in inventory

  3. The Adjustment for the difference between book and physical count values

 

  1. The Inventory value of tires sold and otherwise disposed of

  2. The Inventory value of tires returned to suppliers

  3. The Adjustment for the difference between book and physical count values

 

Comments

A debit balance represents the inventory value of tires.

Note:

Physical inventories should be taken at each month end of the following:

·        Tires

·        Gas, Oil and Grease

·        Paint and Body Shop Materials

These inventories should be priced at the lower of cost or market values.  Any differences between book and physical count values should be adjusted through the following accounts, as applicable:

·        Acct 690, Cost of Sales - Tires

·        Acct 691, Cost of Sales - Gas, Oil and Grease

·        Acct 679, Cost of Sales - Paint and Body Shop Materials

A physical inventory of other merchandise should be taken at least once each year.  It should be priced at the lower of cost or market value.  Any difference between book and physical count values should be adjusted through Acct 692, Cost of Sales - Miscellaneous.