A electronic shop mistakenly ruined/damaged

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Ac
120 Points Posted on 14 February 2022

a electronic shop mistakenly ruined/damaged the customer's  TV  worth RS 200,000 so what are the accounting treatment for it and journal entries 

question 1 - the shop have compensate the customer with new TV of same price i.e. Rs 200,000

question 2 - the shop also keep the damaged TV so they can use its part 

 

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On 14 February 2022 at 17:15 Report
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Quick Summary
This discussion explores the accounting treatment and journal entries when an electronics shop mistakenly damages a customer's TV worth RS 200,000. It covers scenarios where the shop compensates the customer with a new TV of equivalent value and also retains the damaged TV for parts. The entries address reducing purchases, booking sales, and handling compensation as an expense.

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GST Practitioner & Accounts
8992 Points Posted on 14 February 2022
For Damage TV pass entry

Damage TV set A/c Dr
To Purchase A/c Cr
( TV set damage reduce from purchase)
Also reduce 1 TV set from stock journal.

for new TV set pass entry

Trade Debtor's A/c Dr
To Sales A/c Cr
To CGST A/c Cr
To SGST A/c Cr
( Booking of sales entry )





F
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On 14 February 2022 at 19:13
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Ac
120 Points Posted on 14 February 2022

no ! the firm provide th TV for free of cost means the firm bears this cost as expense so what are journal entries and does the damaged TV recorded as assets to the firm 

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On 14 February 2022 at 21:40
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GST Practitioner & Accounts
8992 Points Posted on 14 February 2022
If purchase and sale and purchase of TV set , then it should be Stock item in the books , not Asset I think .
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On 14 February 2022 at 21:53
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Ac
120 Points Posted on 15 February 2022

ok but what are the entry if the firm provide the tv to the customer for free to compensate the customer for his damaged tv ( which is damaged due to firm's fault )

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On 15 February 2022 at 13:34

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