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Fixed assets Written-off by Insurance company

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  • 01-04-2024 3:26pm
    #1
    AgtMike76
    Registered Users Posts: 2 ✭


    Hi, I've a vehicle in my fixed assets book that is being written-off by the insurance (road accident).

    The insurance payout is higher than the original vehicle value ( too long to explain here).

    How to I record this profit in sales/fixed assets. Here are few figures for argument purposes.

    Original vehicle Value €7500.

    1st January 24 Accumulated depreciation €1,800

    Current depreciation on 31st March 24: €450 (1.800/12=150 for 3 months 150*3=450)

    Written down Book value on 31st March 24: € 5,250 (7.500- (1.800+450))

    Insurance payout €10,000 (vehicle market value 8,500+1,500 additional cost branding cost, security cost, custom fittings etc.)

    How do I go to record those values in the fixed assets book and the profit made how it's dealt with.

    Thank you.

    AM



Comments

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    #2
    JVince
    Registered Users Posts: 1,170 ✭✭✭JVince


    "Gain on disposal" is what I would use



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    #3
    SureYWouldntYa
    Registered Users Posts: 7,740 ✭✭✭SureYWouldntYa


    DR gain/loss on disposal of fixed assets, CR motor vehicle disposals - this will get rid of the vehicle from the balance sheet, use the full cost of the vehicle on the balance sheet

    DR depreciation removal on disposal (or similar), CR gain/loss on disposal of fixed assets - this will get rid of the accumulated depreciation, use the full amount of depn on the balance sheet attributable to that vehicle

    The bank receipt should then also be posted to gain/loss on disposal of fixed assets, and this will then leave the net gain in the P&L



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