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how do I account for a loss of asset

Judy Gardner's Profile

Company had fixed asset vehicle that was wrecked and totaled by insurance company. Received payment that was equal to book value. Do I debit Accumulated Depreciation and credit fixed asset? Then when the insurance company check arrives I enter as income then debit income then credit what????

Answers

Anonymous
(SVP & PAO) |

You'll debit Accum Depreciation, credit the fixed asset, debit cash for the insurance proceeds and credit gain on disposal.

phil Wolhar
Title: President/CEO
Company: PAWCO Enterprises, Ltd.
(President/CEO, PAWCO Enterprises, Ltd.) |

Assume $10000 Fixed Asset at cost with $ 4000 Accumulated Depreciation. Net book value is $6000. Debit Cash for $6000, Debit Accumulated Depreciation $4000, Credit Fixed Asset $10000. No gain, No loss.

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