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?
How to Account for receipt of large insurance claim check
Answers
Other Income; repairs go to Other Expenses since they are "extra-ordinary and outside the normal operations of your company"
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).
Filed Under:
Accounting