asset - insurance claim

[Former Member]

dear sap gurus

client got an asset book value 900

depreciation 100

has got an insurance claim for 500

wants to post this income from insurance against asset

the entry he wants is

loss on scrap 400

insurance claim 500

asset 900

pleae provide the solution

[Former Member]

Hi,

Assuming the opening balance as 800 [ 900-100],the entry should be:

1]Insurance Recievable Dr 500

To Insurance [ Revenue] Cr 500.

Create subledger accts a/c appropriately and post them.

2].Upon reciept of the claim;

Dr.Bank 500

Cr.Insurance Recievable 500.

3]

Loss on disposal/W.off 800 [ P& L-Expenditure a/c;If you have already defined acct.determination,posting will go to this a/c.Otherwise create a subledger and post.]

To Asset a/c 800.[ credit the Asset in the usual way]

The loss on the Asset and the insurance claim are altogether two different transactions.If you dibit Insurance [ as you have done],this will mean to be an expense /loss and thus a charge on the income;on the contrary the insurance is a gain here.

Hope this helps.

Regards,

Ramesh.

[Former Member]

Hi

I feel you will have to assign G/L account for loss on scrap in AO90. and then post in ABAVN

pushkaraj