What is Decommissioning liability?

Need the meaning of Decommissioning liability in accounting terms,
also why closing stock will not appear in Trial Balance.Insurance unexpired account is personal or real accounts.
Need explanation for the above question with example in accounting terms.

Asked by: Pratish.M 392 days ago - 1 Answers - 1962 views

1 Answers

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A decommissioning liability requires the fair value of an asset or liability be reported in the period in which it is incurred, i.e. when the expense occurs.

Closing stock does not appear on the trial balance because it is not zero-ed out at the end of each period. It is a running total of the inventory the company has on hand.

Unexpired insurance is a personal asset – it has cash value but only to a specific person or entity. A real asset would be a tangible asset, like a building, car, etc.

Answer by Rick 195 days ago

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