241 - Reserve for LIFO - Used Vehicles

Current Assets

Other Inventories

Synopsis

Account 241

Debits

Credits

  1. The amount of adjustment needed to decrease the reserve (as determined from the LIFO valuation).

  1. The amount of adjustment needed to increase the reserve (as determined from the LIFO valuation).

 

 

Remarks:

This account is provided for those dealers adopting the last-in, first-out (LIFO) method of inventory valuation for used vehicles.

 

The actual inventory value should be reflected in used vehicle inventory accounts (Account 239) and (Account 240).

 

LIFO inventory valuation is very complicated and has very strict rules and regulations.  It is recommended that retailers ONLY utilize this account under the direction of a proper tax authority and/or certified public accountant.

Note: