Question

Goods worth 35,00.000 were destroyed in a fire accident and a claim of 3 1,50,000 has
been accepted by the insurance company. How will it be recorded in final accounts? (1)​

Answer 1

Answer:

1) Total value of loss Rs. 35,00,000 is credited to the trading account

2) Balance of loss amount Rs. 3,50,000 ( 35,00,000 - 31,50,000) should be debited in the profit and loss account.

3)Amount agreed to be given by the insurance company Rs. 31,50,000 should be shown as an asset in the balance sheet as 'insurance claim'

Answer 2

see the above attachment

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