Question

Pankaj consigned 10,000 litres of Oil to Arun at a cost of 55 per litre. The following further
details are available -
Pankaj incurred transportation and insurance cost of 7,500.
During transit, 250 liters were expected to be lost by way of evaporation.
Arun received only 9,000 litres and incurred 9,900 towards taking delivery of goods, 12,500
towards advertising and selling expenses. It was found that 750 litres of oil were lost in
transit due to accident,
Arun is entitled to a Commission of 10%. As per the Account Sales, Arun had sold 7000 litres
at 375 per litre.
Arun also reported that there was a loss of 500 litres of oil in his godown, due to leakage of
packets. This loss was not covered by Insurance.
1. Compute the value of Closing Stock and Abnormal loss.
2. Give Journal Entries for recording Abnormal Loss if Insurance Claim is accepted at
36,000 for transit loss.​

Answer 1

Answer:

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