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re: Car dealers have so much backlog, some 2022s are "new"
Posted on 12/3/23 at 6:31 pm to WhereisAtlanta
Posted on 12/3/23 at 6:31 pm to WhereisAtlanta
quote:Do you think the market value of the inventory is lower than the book value? Also, I’m no accountant, but I don’t think you depreciate inventory. I think you recognize the loss through a write-down. Seems like recognizing a loss is good for tax purposes.
2) It is on the books as an asset and probably collateral, things can get messy when you choose to depreciate something(s) that is/are being used as a security deposit.
No idea how financial covenants are written in security agreements for inventory collateral. It seems to me that refusing to recognize a loss on the collateral would be a breach of a financial covenant since your statements would no longer accurately and fairly represent the assets of the business.
This post was edited on 12/3/23 at 6:34 pm
Posted on 12/3/23 at 8:24 pm to AllbyMyRelf
Love my 2006 GMC Envoy with 161 k
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