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BHPH Solutions

Discuss solutions for dealers getting into BHPH or thinking about it.

Website: http://www.dealers411.net
Location: Russellville, Arkansas
Members: 126
Latest Activity: Feb 13

Discussion Forum

Using SMS Text Messages for Collections

Started by Dominic McWhorter Aug 23, 2012. 0 Replies

Best practices: collections

Started by Rob Hagen. Last reply by Frank Dec 8, 2011. 7 Replies

How many collectors should we have per # of customers?

Started by Mike "BK" Anthony. Last reply by Brad Sutterfield Apr 29, 2011. 4 Replies

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Comment by nathan king, cpa on December 7, 2013 at 8:31pm

thanks

Comment by Dugan Anderson on December 7, 2013 at 8:28pm

He is in Montana.  I will be passing this information on to him and let him know you would be interested in helping.  I will keep you posted.

Comment by nathan king, cpa on December 7, 2013 at 8:21pm

Tax time is coming. To the extent I'm not stepping on Gene's toes, I'd be glad to help in some fashion.

Is he in Montana or elsewhere?

Comment by Dugan Anderson on December 7, 2013 at 8:14pm

I consult with auto dealers, both franchised and independent, BHPH dealers, RV dealers, marine dealers, motorsports dealers and motorcycle dealers.  I help dealers to structure their businesses to maximize profits.

I look  at sales and grosses and the amount of money required to generate those sales.  Then using simple analysis tools I analyze past performances, develop forecasts for the future and track progresses moving forward.  Based on the analysis, I develop programs/processes with the dealer to allow his organization to capitalize on the oportunities that are highlighted in the analysis.  Simply put, I do what ever needs to be done to maximize the dealerships profit potential.

This inquiry concerns a potential client.  I have discussed with him the possibilities of me working with him, and in the process learned of his accounting methods.  By the way, he is currently using "self composed excel spreadsheets".  He needs lots of help.

Comment by Gene Daughtry on December 7, 2013 at 2:18pm
Dugan if I can help with your client somehow let me know.
Comment by nathan king, cpa on December 7, 2013 at 2:09pm

Not to further confuse you about inventory and accrual basis vs cash basis, but your home state's Sen Baucus' tax proposal would allow per Kiplinger "More firms would be able to use cash accounting...those with gross receipts averaging $10 million or less in the previous three years, even if they have inventories..."

In other words as of right now cash basis for a company requiring inventories is not allowed.  even in Montana :) 

Comment by nathan king, cpa on December 7, 2013 at 8:23am

If by " he records a sale as cost of the unit minus the downpayment" you mean dealer cost minus downpmt and not actual sales price minus downpmt from the customer then that is very weird and very wrong.

Also, if you aren't the dealer or an accountant then what type of client business are you trying to get out of him--general dealer operations consulting?-- because he needs some serious help all around. What database software does he use or is he strictly self-composed excel spreadsheets?

Comment by Dugan Anderson on December 6, 2013 at 9:38pm

I have recommended to him he should have a separate Finance Division, discount the contracts to the Finance Company, take the gross in the car company and let the Finance Co. deal with the receivables.

Comment by Dugan Anderson on December 6, 2013 at 9:36pm

First of all, this in not my operation and not my accountant, this is a potential client of mine.  As for the way he accounts for a sale, he records a sale as cost of the unit minus the downpayment (cash in, cash out).  The selling price, contract amount and all other details are not considered.  As payments are made, cash is shown as "Cash In".

Comment by nathan king, cpa on December 6, 2013 at 9:29pm

I'm not sure I understand your description of what your accountant is doing..."he uses inventory cost less down payment to determine gross (which is almost always negative). "

That doesn't make sense since the full selling price is gross sales and the downpmt is irrelevant as to the income for book or taxes. Whether you finance 100% of the selling price or require a downpayment, neither the book nor the taxable income to the dealer is affected, only his cashflow is different.

 

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