Insurance claim accounting

[apcotex Industres Ltd.]

We are manufacturing company, have appointed consignment agents for effecting sale.

one of our consignment was damaged in transit. hence we lodged an insurance claim for the damaged goods. this is accounted as insurance claim receivable.

further the surveyor found a party & sold the entire lot at discounted price on basis of commercial invoice issued by us. the goods were in possession of the surveyor at time of sale & were not brought back to factory. the balance amount is receivable from the insurance company.

My question is should we account the commercial invoice as sale & reflect in turnover

or the sales proceeds should be adjusted against insurance claim receivable.

[DR.MARIAPPAN GOVINDARAJAN]

Have you got clarified in this Issue?

AI Summary

Manufacturing firm's dilemma: Record damaged goods sale as turnover or adjust against insurance claim? Seeking clarity. A manufacturing company faced a situation where a consignment was damaged in transit and an insurance claim was lodged. The damaged goods were sold by a surveyor at a discounted price using a commercial invoice issued by the company. The goods remained with the surveyor and were not returned to the factory. The company seeks advice on whether to account for the commercial invoice as a sale in their turnover or to adjust the sales proceeds against the insurance claim receivable. A reply inquires if the issue has been clarified.