Abnormal Loss - Accounting Treatment & Adjustments

Recording Abnormal Loss

Abnormal loss of stock is also an accounting transaction and has to be brought into the books of accounts through a journal entry.
  • Debit - Abnormal Loss a/c

    Abnormal loss stock is an asset whose value is degraded. The organisation would make efforts to liquidate this asset in a number of different ways like selling the salvaged stock, get insurance realisation etc.

    An account by name Abnormal Loss is used for holding the value of this asset. This asset is created by debiting the value of abnormal loss stock to the Abnormal Loss a/c.

    Abnormal Loss a/c

    asset

    Real a/c

    Debit
    [Debit what comes in]

    Treating the Abnormal Loss a/c as a nominal account representing a loss is also rational, especially in cases where there is no possibility of recovering any of the value either by sale of salvaged stock or from insurance company or any other way.

    We are considering it to be a real account to enable an easier understanding of the transactions involving abnormal loss stocks.

    All abnormal losses may be handled through a single account or a distinct account for each loss may be maintained. Where multiple accounts are being used names indicating the reason for the loss like Stock Lost by Fire Accident, Loss on Transportation, etc. are used to give a better understanding,

  • Credit

    The value of abnormal loss stock represents the value of stock that been used for purposes other than trading or more appropriately stock that has not been used for trading.

    To ascertain the cost of goods sold, the value of stock used for purposes other than trading has to be deducted from the total value of goods by crediting one of the following ledger accounts.

    • Trading a/c
    • Cost of Goods Sold a/c
    • Purchases a/c
    • Stock Lost a/c

    Which account is credited is dependent on what comprises the value of abnormal loss stock and the account in which the related value exists at the time of recording the entry.

Adjusting from Cost of Goods Sold

It would be appropriate to adjust the value of goods used for purposes other than trading from the account that holds the total value of goods. The total value of goods can be assumed to be existing as a debit balance in the Trading a/c to which all direct expenses are transferred at the end of the accounting period or in the Cost of Goods Sold a/c if it is being maintained and all the direct expenses are being transferred to it.

The value of goods used for purposes other than trading are to be deducted from the total value of goods (along with the value of good unsold) in arriving at the cost of goods sold. Since the total value exists as a debit balance, deducting from the total value requires the account holding the total value to be credited.

Thus the value of abnormal loss stock has to be credited to the Trading a/c or the Cost of Goods sold a/c in which the total value of goods/stock is existing as a debit balance.

Credited to Trading a/c

Journal
Particulars Amount
(Dr)
Amount
(Cr)
Abnormal Loss a/c
To Trading a/c
Dr 24,000
24,000
[For the value of abnormal loss stock]
Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount

To Trading a/c 24,000
 


Trading a/c
DrCr
Particulars Amount Particulars Amount
To Opening Stock
To Purchases
To Direct Expenses
To Gross Profit




By Sales
By Abnormal Loss
By Closing Stock

24,000

   

Credited to Cost of Goods Sold a/c

Journal
Particulars Amount
(Dr)
Amount
(Cr)
Abnormal Loss a/c
To Cost of Goods Sold a/c
Dr 24,000
24,000
[For the value of abnormal loss stock]
Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount

To Cost of Goods Sold a/c 24,000
 


Cost of Goods Sold a/c
DrCr
Particulars Amount Particulars Amount
To Opening Stock
To Purchases
To Direct Expenses


By Abnormal Loss
By Closing Stock
By Trading a/c
24,000


   

Adjusting from Purchases

Adjusting the goods used for purposes other than trading from the Purchases a/c would be rational under this circumstance.

The stock lost is physically relatable to the stock that has been purchased during the current period and there are no direct expenses in relation to the stock purchased during the current period or the value of stock lost does not include the direct expenses incurred during the current period.

Journal
Particulars Amount
(Dr)
Amount
(Cr)
Abnormal Loss a/c
To Purchases a/c
Dr 24,000
24,000
[For the value of abnormal loss stock]
Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount

To Purchases a/c 24,000
 


Purchases a/c
DrCr
Particulars Amount Particulars Amount





By Abnormal Loss


24,000

   

During the accounting period

If the journal entry for recording the abnormal loss stock is being recorded any time during the accounting period, then Purchases a/c has to be credited since the Trading a/c and Cost of Goods sold a/c would not be available in the books of accounts as they are accounts that are created only towards the end of the accounting period.

Total abnormal loss of stock in the current accounting period

If the organisation intends to maintain distinct information relating to the abnormal losses of stock all throughout the accounting period since it is a frequent occurrence, then a separate ledger account by name Stock Lost is maintained and all abnormal losses of stocks are credited to that account.
Journal
Particulars Amount
(Dr)
Amount
(Cr)
Abnormal Loss a/c
To Stock Lost a/c
Dr 24,000
24,000
[For the value of abnormal loss of goods]

The Stock Lost a/c is a nominal account which provides the information relating to the total value of stock lost on account of abnormal reasons during the current accounting period. It's balance provides the answer to the question, "What is the total value of stock lost till now"? At the end of the accounting period, Stock Lost a/c is closed by transfer to the Trading a/c or the Cost of Goods sold a/c or the Purchases a/c depending on what the value in the account represents and which account holds the total value of that kind.

Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount

To Stock Lost a/c 24,000
 


Stock Lost a/c
DrCr
Particulars Amount Particulars Amount
To Trading a/c By Stock Lost on Fire
By Abnormal Loss
By Accident Loss

24,000

   

Expenses incurred on Abnormal Loss Stock

The salvaged stock may be in a saleable condition or completely useless. There may be instances when the salvaged stock can be brought into saleable condition by bearing certain expenditure.

This expenditure may be paid in cash or by cheques or may have been incurred and not yet been paid.

  • Debit - Abnormal Loss a/c

    The amount spent is for the purpose of bringing the abnormal loss stock into saleable condition. This would amount to brining the asset by name Abnormal Loss into usable condition. Thus, the expenditure should go into the value of the asset Abnormal Loss.

    The debit balance in the Abnormal Loss a/c reflects its value. To add the expenditure to the value, Abnormal Loss a/c is debited with the amount of expenditure incurred.

  • Credit

    The expenditure incurred may be credited to
    • Cash a/c

      If the expenses are paid out in cash
      Cash a/c

      Real a/c

      Credit
      [Credit what goes out]
    • Bank a/c

      If the expenses are paid by cheque
      Bank a/c

      Personal a/c

      Credit
      [Credit the benefit giver]
    • Expenses Payable a/c

      If the expenses are still to be paid
      Expenses Payable a/c

      Personal a/c

      Credit
      [Credit the benefit giver]

      Note

      The personal account of the service provider is credited if it exists in the books of accounts or if the organisation intends to maintain information relating to the amount receivable from the service provider distinctly.
      Any nominal account prefixed/suffixed by the terms outstanding, prepaid, still receivable, still payable etc., is a personal account and is an equivalent of a debtor or a creditor based on the nature of the balance.
Journal in the books of M/s __ for the period from ____ to _____
Particulars Amount
(Dr)
Amount
(Cr)
Abnormal Loss a/c
To Cash a/c
Dr 1,000
1,000
[For the amount spent on the abnormal loss stock to bring it into saleable condition paid in cash.]
Abnormal Loss a/c
To Bank a/c
Dr 2,800
2,800
[For the amount spent on the abnormal loss stock to bring it into saleable condition paid by cheques.]
Abnormal Loss a/c
To Expense Payable a/c
Dr 1,200
1,200
[For the expenditure incurred on the abnormal loss stock to bring it into saleable condition which is still payable.]
Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount
16/08/_5 To Purchases
To Cash
To Bank
To Expense Payable
24,000
1,000
2,800
1,200
31/12/_5
           

Sale Realisation from Abnormal Loss Stock

The salvaged stock may be directly sold (if in a saleable condition) or after getting them repaired or refurbished.

The sale proceeds may be received in cash or by a cheques or may be still receivable

  • Credit - Abnormal Loss a/c

    Since the asset represented by the Abnormal Loss a/c is being disposed off, it amounts to the asset moving out of the organisation.

    Thus the Abnormal Loss a/c is credited with the amount of sale realisation

  • Debit

    The sale proceeds may be debited to
    • Cash a/c

      If the proceeds are received in cash
      Cash a/c

      Real a/c

      Debit
      [Debit what comes in]
    • Bank a/c

      If the proceeds are received by cheques
      Bank a/c

      Personal a/c

      Debit
      [the benefit receiver]
    • Proceeds Receivable a/c

      If the proceeds are still to be received
      Proceeds Receivable a/c

      Personal a/c

      Debit
      [the benefit receiver]

      Note

      Any nominal account prefixed/suffixed by the terms outstanding, prepaid, still receivable, still payable etc., is a personal account and is an equivalent of a debtor or a creditor.
Journal in the books of M/s __ for the period from ____ to _____
Particulars Amount
(Dr)
Amount
(Cr)
Cash a/c
To Abnormal Loss a/c
Dr 4,000
4,000
[For the amount realised on the sale of abnormal loss stock in cash.]
Bank a/c
To Abnormal Loss a/c
Dr 2,400
2,400
[For the sale proceeds of abnormal loss stock received through a cheques.]
Proceeds Receivable a/c
To Abnormal Loss a/c
Dr 2,900
2,900
[For the sale of salvaged stock and the sale proceeds still receivable.]
Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount
16/08/_5 To Purchases a/c
To Cash a/c
To Bank a/c
To Expenses Payable
24,000
1,000
2,800
1,200
By Cash
By Bank
By Pro. Rec
4,000
2,400
2,900
           

Insurance Realisation

Where the stock has been insured with one or more insurance companies, the insurance company would pay the amount of compensation based on the contract of insurance.

The contract of insurance being a contract of indemnity, the total amount of compensation received from all the insurance companies together would be not more than the total loss incurred.

The insurance amount may be recorded directly after it has been received or immediately on the insurance company accepting the claim.

  • Credit - Abnormal Loss a/c

    Since the asset represented by the Abnormal Loss a/c is being realised (though not physically given away) or disposed off, it amounts to the asset moving out of the organisation.

    Thus the Abnormal Loss a/c is credited with the amount of sale realisation

  • Debit

    The insurance amount may be debited to
    • Bank a/c

      Where the insurance amount has been received from the insurance company and where no entry has been recorded earlier for the amount the insurance company has accepted to pay.
      Bank a/c

      Personal a/c

      Debit
      [Debit the benefit receiver]
    • Insurance Receivable a/c

      Where the insurance company has accepted to pay and the amount has not yet been received, an outstanding may be recorded enabling showing the amount due as an asset.

      This may be shown in the name of Insurance Receivable a/c or the Insurance Company a/c

      Insurance Receivable a/c

      Personal a/c

      Debit
      [Debit the benefit receiver]

      Note

      Any nominal account prefixed/suffixed by the terms outstanding, prepaid, still receivable, still payable etc., is a personal account and is an equivalent of a debtor or a creditor.
Journal in the books of M/s __ for the period from ____ to _____
Particulars Amount
(Dr)
Amount
(Cr)
Bank a/c
To Abnormal Loss a/c
Dr 5,000
5,000
[For the insurance amount relating to the abnormal loss stock realised from the insurance company.]
Insurance Receivable (Company) a/c
To Abnormal Loss a/c
Dr 2,500
2,500
[For the insurance amount accepted to be paid by the insurance company which is still receivable.]
Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount
16/08/_5 To Purchases
To Cash
To Bank
To Expense Payable
24,000
1,000
2,800
1,200
By Cash
By Bank
By Proceeds Receivable
By Bank
By Insurance Receivable
4,000
2,400
2,900
5,000
2,500
           

Commission on Sale

Where there is a commission being paid or payable on the sale of abnormal loss stock it may be
  • Deducted from the sale proceeds received/receivable and only the net proceeds may be brought into account
  • Recorded just like any other expenditure that goes into the value of the Abnormal Loss Stock

Profit or Loss on disposal

The Abnormal Loss a/c may carry a balance after having sold the salvaged stock and realising the insurance amount.

If there is a debit balance it represents the amount of asset value that is unrealisable and as such a loss.

Though, it is a very rare occurrence, the Abnormal Loss a/c may carry a credit balance which indicates that the asset has realised a value greater than the book value, thereby resulting in a profit.

Whether there is a profit or a loss, it is of abnormal nature since it is related to Abnormal Loss a/c. The profit or loss is transferred to the Profit & Loss a/c thereby closing the Abnormal Loss a/c.

When there is a loss

  • Debit - Profit & Loss a/c

    Profit & Loss a/c being a nominal account, any loss should be debited to it.
    Profit & Loss a/c

    Nominal a/c

    Debit
    [Debit all expenses and losses]
  • Credit - Abnormal Loss a/c

    The Abnormal Loss a/c has a debit balance and has to be closed by transferring the balance to the Profit & Loss a/c.

    Thus the Abnormal Loss a/c has to be credited.

    Abnormal Loss a/c

    Real a/c

    Credit
    [Credit what goes out]
    Abnormal Loss a/c carries a debit balance when there is a loss. Transfer of a debit balance from one account to a second results in the second account being debited and the first account being credited.
Journal in the books of M/s __ for the period from ____ to _____
Particulars Amount
(Dr)
Amount
(Cr)
Profit & Loss a/c
To Abnormal Loss a/c
Dr 12,200
12,200
[For the net loss in abnormal loss stock being transferred to the profit and loss account.]
Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount
16/08/_5 To Purchases
To Cash
To Bank
To Expense Payable
24,000
1,000
2,800
1,200
By Cash
By Bank
By Proceeds Receivable
By Bank
By Insurance Receivable
By P/L a/c
4,000
2,400
2,900
5,000
2,500
12,200
    29,000     29,000

Statement

A statement for ascertainment of the loss on disposal of abnormal loss stock can be made up by considering the credit side items as a unit and the debit side items as another.
Loss/Gain on Abnormal Loss Stock
Particulars Amount Amount
a) Realisation
Sale
Cash
Bank
Receivable
Insurance
Received
Receivable


4,000
2,400
2,900

5,000
2,500




9,300


7,500
Total Realisation   16,800
b) Cost/Expenses
Value of Stock
Expenses
Paid in Cash
Paid by Cheque
Outstanding
Commission on Sale



1,000
2,800
1,200

24,000



5,000
Total Cost/Value   29,000
Gain(+)/Loss(−) (a) − (b)   − 12,200

The ledger account format even as a part of the working notes would be useful.

When there is a gain

  • Credit - Profit & Loss a/c

    Profit & Loss a/c being a nominal account, any profit should be credited to it.
    Profit & Loss a/c

    Nominal a/c

    Credit
    [Credit all incomes and gains]
  • Debit - Abnormal Loss a/c

    When there is a gain, the Abnormal Loss a/c has a credit balance and has to be closed by transferring the balance to the Profit & Loss a/c.

    Thus the Abnormal Loss a/c has to be debited.

    Transfer of a credit balance from one account to a second results in the second account being credited and the first account being debited.

Journal in the books of M/s __ for the period from ____ to _____
Particulars Amount
(Dr)
Amount
(Cr)
Abnormal Loss a/c
To Profit & Loss a/c
Dr 2,800
2,800
[For the gain in the abnormal loss account transferred to the profit and loss account.]
Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount
16/08/_5 To Purchases
To Cash
To Bank
To Expense Payable
To P/L a/c
24,000
1,000
2,800
1,200
2,800
By Cash
By Bank
By Proceeds Receivable
By Bank
By Insurance Receivable
4,000
2,400
2,900
20,000
2,500
    31,800     31,800

Insurance realisation is taken as 20,000 in place of 5,000 to generate profit.

Adjustment during Final Accounting

Adjustment is bringing in the effect of the transactions through mathematical operations of addition and subtraction. The adjustments to be made can be found out by ascertained the net effect of the journal entries to be recorded.

Adjustments are generally required for transactions which are not yet recorded at the time of making up the final accounts i.e. towards the end of the accounting period.

The entries involved would be

  • Dr. Abnormal Loss a/c
    Cr. Trading a/c
  • If there are expenses incurred on abnormal loss stock

    Dr. Abnormal Loss a/c
    Cr. Expense Outstanding a/c

  • If there is insurance claim accepted and receivable

    Dr. Insurance Company a/c
    Cr. Abnormal Loss a/c

  • If there are sale proceeds of salvaged stock receivable

    Dr. Proceeds Receivable a/c
    Cr. Abnormal Loss a/c

  • When there is net loss

    Dr. Profit & Loss a/c
    Cr. Abnormal Loss a/c

  • When there is net profit

    Dr. Abnormal Loss a/c
    Cr. Profit & Loss a/c

Working notes for adjustments
Net Entry Adjustment Side Where
Dr. Insurance Company a/c
Dr. Proceeds Receivable a/c
Dr. Profit and Loss a/c
Cr. Profit and Loss a/c
Cr. Trading a/c
Cr. Expense Outstanding a/c
1. () as Debtor
2. () as Debtor
3. () as Abnormal Loss
3. () as Abnormal Loss
4. () as Abnormal Loss
5. () as Expense Outstanding
Assets
Assets
Debit
Credit
Credit
Liabilities
B/S
B/S
P/L
P/L
Trdg
B/S

Read as

  1. Show the amount receivable from the insurance company as a debtor on the assets side of the balance sheet.
  2. Show the amount receivable from the buyer of salvaged stock as a debtor on the assets side of the balance sheet.
  3. This will be either a debit or credit depending on whether there is a loss or gain.

    Show the net loss on the debit side of the profit and loss a/c.

    Show the net gain on the credit side of the profit and loss a/c.

  4. Show the value of abnormal loss stock on the credit side of the Trading a/c
  5. Show the outstanding expense on abnormal loss stock on the liabilities side of the balance sheet.

Note

In handling transactions relating to abnormal loss as adjustment at the end of the accounting period, we assume that the proceeds are receivable, expenses are payable and insurance amount is receivable unless otherwise stated.

The number of elements affected is dependent on whether the transactions relating to expenses, insurance and sale have taken place or not.

Trading and Profit & Loss a/c
DrCr
Particulars Amount Particulars Amount







By Abnormal Loss

24,000
       


To Abnormal Loss


12,200



Balance Sheet of M/s ______ as on 30th June 20_6
Liabilities Amount Assets Amount
 

Expenses Outstanding


1,200

Realisation Receivable

Insurance Company

2,900

2,500

Using Temporary Accounts

Recording the value of stock lost on account of abnormal reasons would result in the Abnormal Loss a/c or an account by any relevant name being created. In recording the transactions relating to expenses on the abnormal loss stock, sale realisations, insurance realisation etc. relating to the abnormal loss stock, one of the ledger accounts affected would have to be this Abnormal Loss a/c.

However, where the journal entry for recording the value of abnormal loss stock has not yet been recorded, the Abnormal Loss a/c would not be found in the books of accounts. In such cases, the accountant might use some temporary account by relevant name to record the transaction.

In problem solving, such temporary accounts can be identified by their presence in the Trial Balance. They have to be cleared by using them in recording the entries relating to abnormal loss stock.

Expenses Paid

When expenses are paid, a temporary account, say by name Expenses on Abnormal Loss a/c may be used to record the expenditure incurred. If such an account is used, it would appear in the Trial Balance.

The Expenses on Abnormal Loss a/c has to be closed by transfer to the Abnormal Loss a/c. The expenditure should not be treated as indirect expenditure.

Journal in the books of M/s __ for the period from ____ to _____
Particulars Amount
(Dr)
Amount
(Cr)
Expenses on Abnormal Loss a/c
To Cash a/c
Dr 2,500
2,500
[For the expenses on abnormal loss stock.]
  • Bank a/c is credited if the payment has been made by a cheque.
  • Outstanding Expenses a/c is credited if the payment is outstanding.

    The personal account of the service provider is credited if it exists in the books of accounts or if the organisation intends to maintain information relating to the amount due to the service provider distinctly.

Trial Balance of M/s _____ as on _____
Particulars L/F Amount
(Dr)
Amount
(Cr)


Expenses on Abnormal Loss







2,500





Journal in the books of M/s __ for the period from ____ to _____
Particulars Amount
(Dr)
Amount
(Cr)
Abnormal Loss a/c
To Expenses on Abnormal Loss a/c
Dr 2,500
2,500
[For the expenses on abnormal loss stock absorbed.]
Expenses on Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount
To Cash 2,500 31/12/_5 By Abnormal Loss 2,500
    2,500     2,500
Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount
31/12/_5
31/12/_5
To Trading a/c
To Expenses on Abnormal Loss
24,000
2,500



Adjustment

Working notes for adjustments
Net Entry Adjustment Side Where
Dr. Abnormal Loss a/c
Dr. Expenses on Abnormal Loss a/c
1. (+) to Abnormal Loss
2. (×) closed


Sale Realisation

When sale proceeds are received, a temporary account, say by name Sale of Abnormal Loss a/c may be used to record the proceeds received/receivable. If such an account is used, it would appear in the Trial Balance.

The Sale of Abnormal Loss a/c has to be closed by transfer to Abnormal Loss a/c. This should not be treated as normal sale.

Journal in the books of M/s __ for the period from ____ to _____
Particulars Amount
(Dr)
Amount
(Cr)
Bank a/c
To Sale of Abnormal Loss a/c
Dr 8,000
8,000
[For the amount received on the sale of abnormal loss stock.]
  • Cash a/c is debited if the proceeds are received in cash.
  • Proceeds Receivable a/c is debited if the proceeds are still receivable.

    The personal account of the buyer is credited if it exists in the books of accounts or if the organisation intends to maintain information relating to the amount receivable from the buyer distinctly.

Trial Balance of M/s _____ as on _____
Particulars L/F Amount
(Dr)
Amount
(Cr)


Sale of Abnormal Loss











8,000

Total      
Journal in the books of M/s __ for the period from ____ to _____
Particulars Amount
(Dr)
Amount
(Cr)
Sale of Abnormal Loss a/c
To Abnormal Loss a/c
Dr 8,000
8,000
[For the sale realisation of abnormal loss stock absorbed.]
Sale of Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount
31/12/_5 To Abnormal Loss 8,000 By Bank 8,000
    8,000     8,000
Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount
31/12/_5
To Trading a/c
24,000

31/12/_5

By Sale of Abnormal Loss

8,000
           

For the purpose of incorporating the same information as adjustment, the temporary account is assumed to have got exhausted and the proceeds are considered for ascertaining the profit or loss on abnormal loss stock.

Adjustment

Working notes for adjustments
Net Entry Adjustment Side Where
Dr. Sale of Abnormal Loss a/c
Dr. Abnormal Loss a/c
1. (×) closed
2. () from Abnormal Loss


Insurance Realisation

When insurance realisation is received, a temporary account, say by name Abnormal Loss Insurance receipts a/c may be used to record the amount received/receivable. If such an account is used, it would appear in the Trial Balance.

The Abnormal Loss Insurance receipts a/c has to be closed by transfer to Abnormal Loss a/c.

Journal in the books of M/s __ for the period from ____ to _____
Particulars Amount
(Dr)
Amount
(Cr)
Bank a/c
To Insurance Received a/c
Dr 5,000
5,000
[For the amount received towards compensation for loss of stock from the insurance company.]
Trial Balance of M/s _____ as on _____
Particulars L/F Amount
(Dr)
Amount
(Cr)


Abnormal Loss Insurance Receipts











5,000

Journal in the books of M/s __ for the period from ____ to _____
Particulars Amount
(Dr)
Amount
(Cr)
Abnormal Loss Insurance Receipts a/c
To Abnormal Loss a/c
Dr 8,000
8,000
[For the insurance realisation of abnormal loss stock absorbed.]
Abnormal Loss Insurance Receipts a/c
DrCr
Date Particulars Amount Date Particulars Amount
31/12/_5 To Abnormal Loss a/c 5,000 By Bank 5,000
    5,000     5,000
Abnormal Loss a/c
DrCr
Date Particulars Amount Date Particulars Amount
31/12/_5
To Trading a/c
24,000

31/12/_5

By Abnormal Loss Insurance Receipts

5,000
           

Adjustment

Working notes for adjustments
Net Entry Adjustment Side Where
Dr. Abnormal Loss Insurance Receipts a/c
Dr. Abnormal Loss a/c
1. (×) closed
2. () from Abnormal Loss