3
Question
Amount of Insurance claim received is dealt in the following manner in Joint Venture Account.
Amount of Insurance claim received is dealt in the following manner in Joint Venture Account.
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Solution
The correct option is C Credited
This account is prepared for
measurement of venture profit. This account is debited with all venture expenses
and credited with all sales or collection. The excess balance of credit side over the debit side shows the profit on
joint venture and vice versa. Profit /Loss are transferred to co-venture's accounts in the profit-sharing ratio.
Entry for insurance claim received is
as:-
Joint bank A/c Dr. xx
To Joint venture account xx
This account is prepared for measurement of venture profit. This account is debited with all venture expenses and credited with all sales or collection. The excess balance of credit side over the debit side shows the profit on joint venture and vice versa. Profit /Loss are transferred to co-venture's accounts in the profit-sharing ratio.
Entry for insurance claim received is as:-
Joint bank A/c Dr. xx
To Joint venture account xx
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