347 - Notes - Long Term Debt - Owners/Other, and/or Long-Term Intercompany Payables

Liabilities

Long Term Debt

Synopsis

Account 347

Debits

Credits

  1. Payments on the principal amount of all loans included in this account.

 

  1. The principal amount of long-term loans received from owners, officers or others loaning funds to the company on a long term basis, e.g. due in a period greater than 12 months.  Also, any intercompany payables not due within a 12 month period.

 

Remarks:

If using this for long-term intercompany accounts payable, assure that any intercompany receivables on the asset side are also long-term.  This would indicate that the dealership does not engage in a monthly exchange of funds between dealerships (NOT recommended practice), and this account should be used judiciously.   Extended, long-term, or very large balances in this account may be monitored by the factory.

A subsidiary record should be maintained indicating details of each loan, payable note, mortgage, and contract.

Interest on all notes included in this account other than mortgages should be recorded monthly and charged to Account 93 – Other Interest.  Mortgage interest should be charged to Interest – Real Estate Mortgage (Account 86).

The principal portion of each note, contract, and mortgage due and payable within the succeeding twelve months from the date of the balance sheet date should be included in Current Amount – LTD (Account 315).

Note: