![]() ![]() What is the journal to be passed for an insurance claim on a vehicle that was in an accident but was repaired? Is it: WHEN CLAIM IS AGREED: DR INSURANCE DEBTOR CR OTHER INCOME PAYMENT RECEIVED! DR BANK CR INSURANCE DEBTOR? CR PROFIT ON MAINTENANCE DR BANK DR LOSS ON MAINT CR INSURANCE DEBTOR PLS CLARIFY. Journals for Insurance Claim on a Repaired Vehicle by: KINGS Founder of Accounting Basics for Students And then you just do the usual entry to record the final payment by the insurance company: Bank.dr $60,000 Insurance claim receivable.cr $60,000 Hope that makes sense! Best, Michael C. #Due to due from journal entry full#Insurance claim receivable.dr $10,000 Loss of assets.cr $10,000 The above journal entry means the loss due to the fire is cancelled out and the insurance claim is $10,000 more, now a full $60,000. ![]() So let's say you originally expected to receive $50,000 insurance payout and now it actually was adjusted to $60,000, which is also the value of the assets that were lost. ![]() In this case, you need to reverse the loss that you recorded originally and increase the debtor (insurance company receivable) by the additional amount you received. So it sounds like the insurance company fully compensated the assets that were lost. #Due to due from journal entry how to#How to pass entry so that claim adjusted and my balance sheet also come into profit because I have got complete compensation. I entered this journal entry: Loss of assets.dr accumulated depreciation.dr Insurance claim receivable.dr To Fixed Assets Due to this entry my balance sheet went into loss but now we have received insurance claim in bank. Sir, In my factory an accident happened and all assets were destroyed by fire. Loss due to Fire - Insurance Adjustment (Insurance Recovered) by: Anonymous Good luck! - Michael Celender Founder of Accounting Basics for Students Return to the Full Accounting Questions and Answers page.Ĭomments for What is the Journal Entry for an Insurance Claim? ![]() Hope you enjoyed our answer for What is the Journal Entry for an Insurance Claim? For more insurance claim questions, check out the comments section below and even more questions further below that. The entries would be: Dr Insurer (debtor) $5,000 Dr Accumulated depreciation $3,000 Dr Loss $2,000 Cr Delivery vehicle (asset) $10,000 Later: Dr Bank $5,000 Cr Insurer (debtor) $5,000 There you go. 3) A delivery vehicle, which had a cost of $10,000 and accumulated depreciation of $3,000, was destroyed by fire. For asset/s that were destroyed that were subject to depreciation, one would take out the accumulated depreciation account too. The journal entry would be: Dr Insurer (debtor) $50,000 Dr Loss $10,000 Cr Storeroom (asset) $60,000 And later when they make the payment: Dr Bank $50,000 Cr Insurer (debtor) $50,000 In this second scenario we record the loss (the difference between the value of the asset lost and the amount of the claim) of $10,000. In this case the entry would be: Dr Insurer (debtor) $60,000 Cr Storeroom (asset) $60,000 And later when the insurer makes the payment: Dr Bank $60,000 Cr Insurer (debtor) $60,000 2) Now let's say the agreed amount of the claim was $50,000 instead of $60,000. 1) Let's say a storeroom and its contents, valued at $60,000, were destroyed by fire. Q: What is the journal entry for the claim recovered from fire insurance? A: This depends on the exact asset/s that were destroyed in the fire and to what extent they were covered. ![]()
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