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How to Account for receipt of large insurance claim check

Ron Rochester's Profile

A customer caused damage to my work facility and we received a settlement check from his insurance company. We haven't paid for repairs yet....what accounting entries should be done for this non-recurring incident?

Answers

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
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(President & CFO, SBAConsulting.com) |

Other Income; repairs go to Other Expenses since they are "extra-ordinary and outside the normal operations of your company"

Len Green
Title: Performance Improvement Consultant and E..
Company: Haygarth Consulting LLC
LinkedIn Profile
(Performance Improvement Consultant and ERP Strategist, Haygarth Consulting LLC) |

Wayne may "beat" me up on this:)
Assuming you are going to incur the repair costs,why not offset the reimbursement to the R&M expense account? That way the "outlier" dimension of the expense is reduced and it does not impact annual comparisons. (at least from a management reporting perspective that's how I see it).

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