Question

Goods worth rs 3000 were lost by theft.the insurance company admitted the claim in full

Answer 1

Answer:

Journal Entries to be passed when insurance claim is accepted by insurance company on loss of goods by fire :

Loss by fire A/c. Dr.

To trading A/c

(Being purchase account decreased)

Insurance claim A/c. Dr.

To loss by fire A/c

(Being ins. claim lodged and loss by fire account nulified)

Bank A/c. Dr.

P&L A/c Dr.

To insurance claim A/c

(Being claim settled)