Q
Goods in stock worth 800 are destroyed by fire and the Insurance Co. is accepted the claim for 600. Adjustment would involve
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A
A. Debit of 800 to trading account and credit of 600 and 200 to insurance company and
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B
B. Deduct the 800 from closing stock in the trading account
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C
C. Credit insurance company for 600
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D
D. Debit of 600 and 200 to insurance company and profit and loss account respectively and credit of 800 to trading account
Correct Answer:
D. D. Debit of 600 and 200 to insurance company and profit and loss account respectively and credit of 800 to trading account
