Asset stolen and money recovered from Security company

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This discussion covers the accounting entries required when a company laptop is stolen and the cost is recovered from a security agency. The proposed treatment involves capitalising the new laptop, writing off the old one at its written-down value, and recognising any remaining recovery as other income. It also details the journal entries for purchasing the new asset and receiving funds from the security agency.

Viren Gandhi

Viren Gandhi (Querist)
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31 May 2020 Dear All,

We were using one laptop for almost three years and provide the depreciation in books as per our company policy. Three days back some one stolen from office.

Since we have outside security agencies hence mangement took the decision to purchase the new one and debit all the money to security agencies

Pls help me with the accounting treatment for stolen assets as well as purchase the new one and money recovered from outside agencies

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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31 May 2020 Capitalise new laptop, against it charge off old laptop and the balance amount take it to other income.

Message likes : 1 times

CA Ankur Tripathi

CA Ankur Tripathi (Expert)
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01 June 2020 Security agency A/c Dr ( Amount of new laptop)
To Bank

New Laptop A/c Dr xxxx (Purchase Amount)
To Old laptop A/c ( WDV)
To other income (Balancing figure)

Bank Dr
To security agency
(On receipt of payment from security agency)

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