What is the accounting treatment of loss of stock by theft if insurance compensation is received after balance sheet date but before approval of final accounts?
Thanks and Regards
(Ekta)
6 Replies
Rama chary Rachakonda
(Master in Accounts & Lawyer email ID:ramachary64@gmail.com voice no:9989324294)
(5128 Points)
Replied 02 December 2014
(1)Debit cost of goods sold
credit inventory
(2) Debit Insurance compensation receivable
credit other income - insurance compensation
Ekta
(CA FINAL(Article) )
(94 Points)
Replied 02 December 2014
Thank u sir
one more ques..claim was lodged for full amount before balance sheet date but only part of compensation is received then what will be accounting treatment..
CA Raj Doshi
(Practising CA)
(8924 Points)
Replied 03 December 2014
Book the amount receivable to the tune of actual amount received. - It is Conservation. Provide for all possible losses.
CA Raj Doshi
(Practising CA)
(8924 Points)
Replied 03 December 2014
Conservatism * correction in previous msg.
Mukesh Kumar Singh
(CA-FINAL)
(4094 Points)
Replied 03 December 2014
| Originally posted by : Rama chary | ||
 |
(1)Debit cost of goods sold credit inventory (2) Debit Insurance compensation receivable credit other income - insurance compensation |
 |
Agreed
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