Insurance Claims

Good Morning Sir/Madam , In the "Accounting - CA INTERMEDIATE Group 1( Without AS ) - Chapter 9. Insurance Claims - Module No. 5 named "Illustration 4" , In the question it is mentioned that "Cost of salvaged being Rs11,200...." , From What I understood , "Cost of salvaged" means it doesn't include the profit portion . While the "Stock on the date of fire" includes the profit portion. So shouldn't we reduce the profit portion from the stock on date of fire , before reducing the salvaged value to compute the "Loss of stock due to fire ? (or) The "Cost of salvaged Rs11,200" simply means the amount Realized from the Disposal of the damaged goods ? Kindly Clarify.

Avasarala Vivek Aditya

CA Inter

★ 6K+

21-Apr-22 10:02

160