Hanoi Truck Rental Cost Accounting: A Comprehensive Guide

Many Hanoi truck drivers and transportation business owners are familiar with Tuan, the owner of a Hyundai HD120 truck operating on the North-South route. Rumor has it that his monthly income reaches tens of millions of VND. However, few know that Tuan once struggled due to a lack of understanding of truck rental cost accounting.

Back then, his truck frequently experienced minor breakdowns. During repairs, he had to rent other trucks to fulfill orders. Repair costs, rental fees, fuel expenses, toll fees, and parking fees all piled up, leaving him overwhelmed. At the end of each month, reviewing his books revealed minimal profit.

Fortunately, a friend introduced him to a skilled accountant in Cau Giay District, Hanoi. This encounter enlightened Tuan on the proper and efficient methods of truck rental cost accounting.

So, what’s the correct way to account for truck rental costs? Let’s delve into the details with XE TẢI HÀ NỘI in this article!

What is Truck Rental Cost Accounting?

Truck rental cost accounting involves systematically and comprehensively recording, tracking, and reflecting all expenses incurred when businesses or individuals rent trucks for business operations or personal needs.

Accurate truck rental cost accounting is crucial for businesses, enabling them to:

• Control Costs: Closely monitor rental expenses, facilitating effective resource management and budget allocation.
• Calculate Accurate Costs: Provide a basis for precise product and service cost calculation, ensuring market competitiveness.
• Prepare Financial Reports: Furnish accurate data for regulatory financial reporting.

Truck Rental Cost Components

When renting a truck, you may encounter the following expenses:

• Rental Fee: A fixed daily or monthly cost based on the truck type, rental duration, and distance traveled.
• Fuel Costs: Dependent on the truck type, distance traveled, and current fuel prices.
• Toll and Parking Fees: Incurred when passing toll booths and parking at designated areas.
• Repair and Maintenance Fees: Costs associated with fixing any breakdowns or damages during the rental period.
• Other Costs: Traffic violation fines (if any), driver’s meals and accommodation (if renting a truck with a driver).

How to Account for Truck Rental Costs

1. Gather Complete Documentation:

When renting, request comprehensive documentation from the rental provider, including the rental agreement, VAT invoice, receipts, and vehicle handover reports. These documents serve as crucial legal bases for cost accounting.

2. Determine the Appropriate Account:

Select the correct account for recording expenses based on the truck’s intended use. For example:

• If renting for goods transportation, use account 154 – Work in Progress.
• If renting for business administration, use account 642 – Administrative Expenses.

3. Prepare Payment Vouchers and Journal Entries:

Based on the collected documents, prepare payment vouchers and record the corresponding journal entries.

Example:

• Payment Voucher No. 01: Payment for Hyundai HD120 truck rental from ABC Transportation Co., Ltd. in Hoang Mai District, Hanoi.
• Journal Entry:
  • Debit Account 154: 10,000,000 VND
  • Credit Account 111: 10,000,000 VND

Note: Truck rental cost accounting methods may vary depending on the company’s size and organizational structure. Consult with an accounting expert or tax advisor for accurate procedures.

Furthermore, accounting software can streamline truck rental cost management. Such software provides efficient and professional expense tracking.

Besides cost accounting, consider factors like choosing the right truck type, thoroughly reviewing the rental agreement, and maintaining the vehicle to prevent unnecessary repair and maintenance costs.