Used Car Dealership Setup/Trade-ins

You have to be careful, but you can do it. Each time you purchase a vehicle, create an inventory part item for it, say stock number 4943. Then, as you invest $ in the vehicle to get it ready to sell, make each expense an inventory item as a sub-item of 4943. In the end, you have the vehicle 4943, and several sub-items 4943A, 4943B, 4943C, and so forth.

At the time of sale, sell 4943 and all the sub-items A, B, C, etc. The sales price goes on the line with the car, the sub-items are sold for zero dollars. This gets the entire cost of the vehicle out of inventory and into cost of goods sold.

For trade-ins I created a non-invetory part item that coded to a bank type account I called Inventory Clearing. The negative on the invoice created a debit entry in that account. The client then was to create a check on that clearing account for a new stock number (inventory part item) which created the new inventory.  The double-check was that that clearing account should always have a zero balance.

I used this with a car sales lot for years and we created monthly financial statements checking against actual inventory and COGS each month. Worked like a champ.

Good luck.