454B – Other – Warranty Labor

Service Department

Sales Synopsis

Account 454B

Debits

Credits

 

  1. The amount of all OTHER labor performed under the factory warranty.

654B – Other – Warranty Labor

Service Department

Cost of Sales Synopsis

Account 654B

Debits

Credits

  1. The cost of all OTHER labor performed under the factory warranty.

 

 

Remarks:

The balances in this account represent the mechanical labor for all warranty work performed on completed warranty repair orders and similar documents for claims against other manufacturers.  All incomplete repair orders are work-in-process and should be handled as outlined in Work in Process – Labor (Account 247).

 

Time spent on each operation, or on each repair order, should be recorded in accordance with applicable warranty policy.

 

Warranty and transportation claims must be handled and submitted in accordance with applicable warranty policy.

 

Labor performed under extended service contract plans should be recorded in Customer Labor – Other (Account 450B).

 

A separate journal and claims register should be maintained for each manufacturer's products sold by the retailer.