Business Laws and Business Correspondence and Reporting (Paper-2) - May 2022 (Answer Key) | Business Laws for CA Foundation PDF Download

 Page 1


PAPER – 1: PRINCIPLES AND PRACTICE OF ACCOUNTING 
Question No. 1 is compulsory. 
Attempt any four questions from the remaining five questions. 
Wherever necessary, suitable assumptions should be made and disclosed by way of note 
forming part of the answer. 
Working Notes should form part of the answer. 
Question 1 
(a) State with reasons, whether the following statements are True or False: 
(i) A claim that an enterprise is pursuing through legal process, where the outcome is 
uncertain, is a Contingent Liability. · 
(ii) At the end of the accounting year, all the nominal accounts of the ledger book are 
balanced. 
(iii) The specific due date excludes the addition of grace days to arrive at the due date. 
(iv) Any amount spent for replacement of worn out part of a machine is capital 
expenditure.  
(v) Debentures Suspense Account appears on the Liability side of the Balance Sheet of 
a Company. 
(vi) If the errors are detected after preparing trial balance, then all the errors are rectified 
through suspense account. (6 x 2 = 12 Marks) 
(b)  Briefly explain the following Concepts of Accounting:  
(i)  Money Measurement Concept 
(ii)  Periodicity Concept. (4 Marks) 
(c)  One of your clients Mr. X asked you to finalize his account for the year ended  
31
st
 March,2022. As a basis for audit, Mr. X furnished you with the following statement: 
 Dr. Cr. 
X's Capital  4,668 
X's Drawings 1,692  
Leasehold Premises 2,250  
Sales  8,250 
Due from customers  1,590 
Purchases 3,777  
Purchase Return 792  
© The Institute of Chartered Accountants of India
Page 2


PAPER – 1: PRINCIPLES AND PRACTICE OF ACCOUNTING 
Question No. 1 is compulsory. 
Attempt any four questions from the remaining five questions. 
Wherever necessary, suitable assumptions should be made and disclosed by way of note 
forming part of the answer. 
Working Notes should form part of the answer. 
Question 1 
(a) State with reasons, whether the following statements are True or False: 
(i) A claim that an enterprise is pursuing through legal process, where the outcome is 
uncertain, is a Contingent Liability. · 
(ii) At the end of the accounting year, all the nominal accounts of the ledger book are 
balanced. 
(iii) The specific due date excludes the addition of grace days to arrive at the due date. 
(iv) Any amount spent for replacement of worn out part of a machine is capital 
expenditure.  
(v) Debentures Suspense Account appears on the Liability side of the Balance Sheet of 
a Company. 
(vi) If the errors are detected after preparing trial balance, then all the errors are rectified 
through suspense account. (6 x 2 = 12 Marks) 
(b)  Briefly explain the following Concepts of Accounting:  
(i)  Money Measurement Concept 
(ii)  Periodicity Concept. (4 Marks) 
(c)  One of your clients Mr. X asked you to finalize his account for the year ended  
31
st
 March,2022. As a basis for audit, Mr. X furnished you with the following statement: 
 Dr. Cr. 
X's Capital  4,668 
X's Drawings 1,692  
Leasehold Premises 2,250  
Sales  8,250 
Due from customers  1,590 
Purchases 3,777  
Purchase Return 792  
© The Institute of Chartered Accountants of India
2 FOUNDATION EXAMINATION: MAY, 2022 
Loan from Bank  768 
Trade Expense 2,100  
Trade Payable 1,584  
Bills Payable 300  
Salaries and Wages 1,800  
Cash at Bank 678  
Opening Inventory  792 
Rent and Rates 1,389  
Sales Return  294 
 16,362 16,362 
 The closing inventory was `1,722. Mr. X claims that he has recorded every transaction 
correctly as the trial balance is tallied. Check the accuracy of the above trial balance and 
give reasons for the errors, if any.  (4 Marks) 
Answer  
(a) (i) False: A claim that an enterprise is pursuing through legal process, where the 
outcome is uncertain, is a contingent asset. 
(ii) False: At the end of the accounting year, all the nominal accounts of the ledger book 
are totalled and transferred to Profit & Loss A/c. 
(iii) True: Where the due date is specifically given, then there is no need of further 
addition of 3 days grace to it. 
(iv) False: Amount spent for replacement of any worn- out part of a machine is revenue 
expense since it is part of its maintenance cost.  
(v) False: Debentures Suspense Account appears on asset side of Balance Sheet under 
Non-Current Asset. 
(vi) False: If the errors are detected after preparing trial balance, then all the errors are 
not rectified through suspense account. There may be Errors of Principle and/or 
Errors of Omission, which can be rectified without opening a suspense account. 
(b)  Money Measurement concept: As per this concept, only those transactions, which can be 
measured in terms of money are recorded. Since money is the medium of exchange and 
the standard of economic value, this concept requires that those transactions alone that 
are capable of being measured in terms of money be only to be recorded in the books of 
accounts. Transactions and events that cannot be expressed in terms of money are not 
recorded in the business books. 
 
© The Institute of Chartered Accountants of India
Page 3


PAPER – 1: PRINCIPLES AND PRACTICE OF ACCOUNTING 
Question No. 1 is compulsory. 
Attempt any four questions from the remaining five questions. 
Wherever necessary, suitable assumptions should be made and disclosed by way of note 
forming part of the answer. 
Working Notes should form part of the answer. 
Question 1 
(a) State with reasons, whether the following statements are True or False: 
(i) A claim that an enterprise is pursuing through legal process, where the outcome is 
uncertain, is a Contingent Liability. · 
(ii) At the end of the accounting year, all the nominal accounts of the ledger book are 
balanced. 
(iii) The specific due date excludes the addition of grace days to arrive at the due date. 
(iv) Any amount spent for replacement of worn out part of a machine is capital 
expenditure.  
(v) Debentures Suspense Account appears on the Liability side of the Balance Sheet of 
a Company. 
(vi) If the errors are detected after preparing trial balance, then all the errors are rectified 
through suspense account. (6 x 2 = 12 Marks) 
(b)  Briefly explain the following Concepts of Accounting:  
(i)  Money Measurement Concept 
(ii)  Periodicity Concept. (4 Marks) 
(c)  One of your clients Mr. X asked you to finalize his account for the year ended  
31
st
 March,2022. As a basis for audit, Mr. X furnished you with the following statement: 
 Dr. Cr. 
X's Capital  4,668 
X's Drawings 1,692  
Leasehold Premises 2,250  
Sales  8,250 
Due from customers  1,590 
Purchases 3,777  
Purchase Return 792  
© The Institute of Chartered Accountants of India
2 FOUNDATION EXAMINATION: MAY, 2022 
Loan from Bank  768 
Trade Expense 2,100  
Trade Payable 1,584  
Bills Payable 300  
Salaries and Wages 1,800  
Cash at Bank 678  
Opening Inventory  792 
Rent and Rates 1,389  
Sales Return  294 
 16,362 16,362 
 The closing inventory was `1,722. Mr. X claims that he has recorded every transaction 
correctly as the trial balance is tallied. Check the accuracy of the above trial balance and 
give reasons for the errors, if any.  (4 Marks) 
Answer  
(a) (i) False: A claim that an enterprise is pursuing through legal process, where the 
outcome is uncertain, is a contingent asset. 
(ii) False: At the end of the accounting year, all the nominal accounts of the ledger book 
are totalled and transferred to Profit & Loss A/c. 
(iii) True: Where the due date is specifically given, then there is no need of further 
addition of 3 days grace to it. 
(iv) False: Amount spent for replacement of any worn- out part of a machine is revenue 
expense since it is part of its maintenance cost.  
(v) False: Debentures Suspense Account appears on asset side of Balance Sheet under 
Non-Current Asset. 
(vi) False: If the errors are detected after preparing trial balance, then all the errors are 
not rectified through suspense account. There may be Errors of Principle and/or 
Errors of Omission, which can be rectified without opening a suspense account. 
(b)  Money Measurement concept: As per this concept, only those transactions, which can be 
measured in terms of money are recorded. Since money is the medium of exchange and 
the standard of economic value, this concept requires that those transactions alone that 
are capable of being measured in terms of money be only to be recorded in the books of 
accounts. Transactions and events that cannot be expressed in terms of money are not 
recorded in the business books. 
 
© The Institute of Chartered Accountants of India
 PAPER – 1 : PRINCIPLES AND PRACTICE OF ACCOUNTING 3 
 Periodicity concept:  According to this concept, accounts should be prepared after every 
period not at the end of the life of the entity. This is also called the concept of definite 
accounting period. Usually, this period is one accounting year. We generally follow from  
1
st
 April of a year to 31st March of the immediately following year. 
(c)      Corrected Trial Balance of Mr. X as on 31
st
 March, 2022 
Reasons: 
1. Due from customers is an asset, so its balance will be a debit balance. 
2. Purchases return account always shows a credit balance because assets goes out. 
3. Trade Payable is a liability, so its balance will be a credit balance. 
4. Bills payable is a liability, so its balance will be a credit balance. 
5.  Inventory (opening) represents assets, so it will have a debit balance. 
6.   Sales return account always shows a debit balance because assets come in. 
 
 
Particulars Dr. Amount ` Cr. Amount `  
X’s Capital   4,668  
X’s Drawings 1,692  
 
Leasehold premises 2,250  
 
Sales   8,250  
Due from customers 1,590  
 
Purchases 3,777  
 
Purchases returns   792  
Loan from Bank   768  
Trade expenses 2,100  
 
Trade Payable   1,584  
Bills payable   300  
Salaries and Wages 1,800  
 
Cash at Bank 678  
 
Inventory (1.4.2021) 792  
 
Rent and rates 1,389  
 
Sales return 294  
 
  16,362  16,362  
© The Institute of Chartered Accountants of India
Page 4


PAPER – 1: PRINCIPLES AND PRACTICE OF ACCOUNTING 
Question No. 1 is compulsory. 
Attempt any four questions from the remaining five questions. 
Wherever necessary, suitable assumptions should be made and disclosed by way of note 
forming part of the answer. 
Working Notes should form part of the answer. 
Question 1 
(a) State with reasons, whether the following statements are True or False: 
(i) A claim that an enterprise is pursuing through legal process, where the outcome is 
uncertain, is a Contingent Liability. · 
(ii) At the end of the accounting year, all the nominal accounts of the ledger book are 
balanced. 
(iii) The specific due date excludes the addition of grace days to arrive at the due date. 
(iv) Any amount spent for replacement of worn out part of a machine is capital 
expenditure.  
(v) Debentures Suspense Account appears on the Liability side of the Balance Sheet of 
a Company. 
(vi) If the errors are detected after preparing trial balance, then all the errors are rectified 
through suspense account. (6 x 2 = 12 Marks) 
(b)  Briefly explain the following Concepts of Accounting:  
(i)  Money Measurement Concept 
(ii)  Periodicity Concept. (4 Marks) 
(c)  One of your clients Mr. X asked you to finalize his account for the year ended  
31
st
 March,2022. As a basis for audit, Mr. X furnished you with the following statement: 
 Dr. Cr. 
X's Capital  4,668 
X's Drawings 1,692  
Leasehold Premises 2,250  
Sales  8,250 
Due from customers  1,590 
Purchases 3,777  
Purchase Return 792  
© The Institute of Chartered Accountants of India
2 FOUNDATION EXAMINATION: MAY, 2022 
Loan from Bank  768 
Trade Expense 2,100  
Trade Payable 1,584  
Bills Payable 300  
Salaries and Wages 1,800  
Cash at Bank 678  
Opening Inventory  792 
Rent and Rates 1,389  
Sales Return  294 
 16,362 16,362 
 The closing inventory was `1,722. Mr. X claims that he has recorded every transaction 
correctly as the trial balance is tallied. Check the accuracy of the above trial balance and 
give reasons for the errors, if any.  (4 Marks) 
Answer  
(a) (i) False: A claim that an enterprise is pursuing through legal process, where the 
outcome is uncertain, is a contingent asset. 
(ii) False: At the end of the accounting year, all the nominal accounts of the ledger book 
are totalled and transferred to Profit & Loss A/c. 
(iii) True: Where the due date is specifically given, then there is no need of further 
addition of 3 days grace to it. 
(iv) False: Amount spent for replacement of any worn- out part of a machine is revenue 
expense since it is part of its maintenance cost.  
(v) False: Debentures Suspense Account appears on asset side of Balance Sheet under 
Non-Current Asset. 
(vi) False: If the errors are detected after preparing trial balance, then all the errors are 
not rectified through suspense account. There may be Errors of Principle and/or 
Errors of Omission, which can be rectified without opening a suspense account. 
(b)  Money Measurement concept: As per this concept, only those transactions, which can be 
measured in terms of money are recorded. Since money is the medium of exchange and 
the standard of economic value, this concept requires that those transactions alone that 
are capable of being measured in terms of money be only to be recorded in the books of 
accounts. Transactions and events that cannot be expressed in terms of money are not 
recorded in the business books. 
 
© The Institute of Chartered Accountants of India
 PAPER – 1 : PRINCIPLES AND PRACTICE OF ACCOUNTING 3 
 Periodicity concept:  According to this concept, accounts should be prepared after every 
period not at the end of the life of the entity. This is also called the concept of definite 
accounting period. Usually, this period is one accounting year. We generally follow from  
1
st
 April of a year to 31st March of the immediately following year. 
(c)      Corrected Trial Balance of Mr. X as on 31
st
 March, 2022 
Reasons: 
1. Due from customers is an asset, so its balance will be a debit balance. 
2. Purchases return account always shows a credit balance because assets goes out. 
3. Trade Payable is a liability, so its balance will be a credit balance. 
4. Bills payable is a liability, so its balance will be a credit balance. 
5.  Inventory (opening) represents assets, so it will have a debit balance. 
6.   Sales return account always shows a debit balance because assets come in. 
 
 
Particulars Dr. Amount ` Cr. Amount `  
X’s Capital   4,668  
X’s Drawings 1,692  
 
Leasehold premises 2,250  
 
Sales   8,250  
Due from customers 1,590  
 
Purchases 3,777  
 
Purchases returns   792  
Loan from Bank   768  
Trade expenses 2,100  
 
Trade Payable   1,584  
Bills payable   300  
Salaries and Wages 1,800  
 
Cash at Bank 678  
 
Inventory (1.4.2021) 792  
 
Rent and rates 1,389  
 
Sales return 294  
 
  16,362  16,362  
© The Institute of Chartered Accountants of India
4 FOUNDATION EXAMINATION: MAY, 2022 
Question 2 
(a) The Machinery Account of a Factory showed a balance of ` 95 Lakhs on 1
st
 April,2020. 
The Books of Accounts 
 Depreciation is written off of the Factory are closed on 31
st
 March every year and @ 10% 
per annum under the Diminishing Balance Method. On 1
st
 September,2020 a new machine 
was acquired at a cost of ` 14 Lakhs and ` 44,600 was incurred on the same day as 
installation charges for erecting the machine. On 1
st
 September,2020 a machine which had 
cost ` 21,87,000 on 1
st
 April,2018 was sold for ` 3,75,000. Another machine which had 
cost ` 21,85,000 on 1
st
 April,2019 was scrapped on 1
st
 September,2020 and it realized 
nothing. 
 Prepare Machinery Account for the year ended 31
st
 March,2021. Allow the same rate of 
depreciation as in the past and calculate depreciation to the nearest multiple of a rupee. 
Also show all the necessary working notes. (10 Marks) 
(b) Zed Enterprises furnishes the following information for the year ended 31st March,2021. 
Particulars Amount (`) 
Value of Stock as on 1st April,2020 
Purchases during the year 
Manufacturing Expenses during the year 
Sales during the year 
28,00,000 
1,38,40,000 
28,00,000 
2,08,80,000 
 The following further information is also provided: 
(i) At the time of valuing stock on 31
st 
March,2020 a sum of ` 2,40,000 was written off 
for a particular item which was originally purchased for ` 8,00,000. This item was sold 
during the year ended 31
st
 March,2021 for ` 6,40,000. 
(ii)  Except for the above transaction, the rate of gross profit during the year was 1/3rd on 
cost. 
Ascertain the value of Stock as on 31st March,2021. (5 Marks) 
(c)  From the following particulars, prepare a Bank Reconciliation Statement on 31
st
 March 
2021· 
Particulars Amount (`) 
Bank balance as per Pass Book 
Bills discounted dishonored not recorded in Cash Book 
Cheque received entered twice in Cash Book 
Bank charges entered twice in Cash Book 
Insurance premium paid directly by Bank under-standing instruction 
Cheque issued but not presented to Bank for payment 
25,00,000 
12,50,000 
25,000 
5,000 
1,50,000 
12,50,000 
© The Institute of Chartered Accountants of India
Page 5


PAPER – 1: PRINCIPLES AND PRACTICE OF ACCOUNTING 
Question No. 1 is compulsory. 
Attempt any four questions from the remaining five questions. 
Wherever necessary, suitable assumptions should be made and disclosed by way of note 
forming part of the answer. 
Working Notes should form part of the answer. 
Question 1 
(a) State with reasons, whether the following statements are True or False: 
(i) A claim that an enterprise is pursuing through legal process, where the outcome is 
uncertain, is a Contingent Liability. · 
(ii) At the end of the accounting year, all the nominal accounts of the ledger book are 
balanced. 
(iii) The specific due date excludes the addition of grace days to arrive at the due date. 
(iv) Any amount spent for replacement of worn out part of a machine is capital 
expenditure.  
(v) Debentures Suspense Account appears on the Liability side of the Balance Sheet of 
a Company. 
(vi) If the errors are detected after preparing trial balance, then all the errors are rectified 
through suspense account. (6 x 2 = 12 Marks) 
(b)  Briefly explain the following Concepts of Accounting:  
(i)  Money Measurement Concept 
(ii)  Periodicity Concept. (4 Marks) 
(c)  One of your clients Mr. X asked you to finalize his account for the year ended  
31
st
 March,2022. As a basis for audit, Mr. X furnished you with the following statement: 
 Dr. Cr. 
X's Capital  4,668 
X's Drawings 1,692  
Leasehold Premises 2,250  
Sales  8,250 
Due from customers  1,590 
Purchases 3,777  
Purchase Return 792  
© The Institute of Chartered Accountants of India
2 FOUNDATION EXAMINATION: MAY, 2022 
Loan from Bank  768 
Trade Expense 2,100  
Trade Payable 1,584  
Bills Payable 300  
Salaries and Wages 1,800  
Cash at Bank 678  
Opening Inventory  792 
Rent and Rates 1,389  
Sales Return  294 
 16,362 16,362 
 The closing inventory was `1,722. Mr. X claims that he has recorded every transaction 
correctly as the trial balance is tallied. Check the accuracy of the above trial balance and 
give reasons for the errors, if any.  (4 Marks) 
Answer  
(a) (i) False: A claim that an enterprise is pursuing through legal process, where the 
outcome is uncertain, is a contingent asset. 
(ii) False: At the end of the accounting year, all the nominal accounts of the ledger book 
are totalled and transferred to Profit & Loss A/c. 
(iii) True: Where the due date is specifically given, then there is no need of further 
addition of 3 days grace to it. 
(iv) False: Amount spent for replacement of any worn- out part of a machine is revenue 
expense since it is part of its maintenance cost.  
(v) False: Debentures Suspense Account appears on asset side of Balance Sheet under 
Non-Current Asset. 
(vi) False: If the errors are detected after preparing trial balance, then all the errors are 
not rectified through suspense account. There may be Errors of Principle and/or 
Errors of Omission, which can be rectified without opening a suspense account. 
(b)  Money Measurement concept: As per this concept, only those transactions, which can be 
measured in terms of money are recorded. Since money is the medium of exchange and 
the standard of economic value, this concept requires that those transactions alone that 
are capable of being measured in terms of money be only to be recorded in the books of 
accounts. Transactions and events that cannot be expressed in terms of money are not 
recorded in the business books. 
 
© The Institute of Chartered Accountants of India
 PAPER – 1 : PRINCIPLES AND PRACTICE OF ACCOUNTING 3 
 Periodicity concept:  According to this concept, accounts should be prepared after every 
period not at the end of the life of the entity. This is also called the concept of definite 
accounting period. Usually, this period is one accounting year. We generally follow from  
1
st
 April of a year to 31st March of the immediately following year. 
(c)      Corrected Trial Balance of Mr. X as on 31
st
 March, 2022 
Reasons: 
1. Due from customers is an asset, so its balance will be a debit balance. 
2. Purchases return account always shows a credit balance because assets goes out. 
3. Trade Payable is a liability, so its balance will be a credit balance. 
4. Bills payable is a liability, so its balance will be a credit balance. 
5.  Inventory (opening) represents assets, so it will have a debit balance. 
6.   Sales return account always shows a debit balance because assets come in. 
 
 
Particulars Dr. Amount ` Cr. Amount `  
X’s Capital   4,668  
X’s Drawings 1,692  
 
Leasehold premises 2,250  
 
Sales   8,250  
Due from customers 1,590  
 
Purchases 3,777  
 
Purchases returns   792  
Loan from Bank   768  
Trade expenses 2,100  
 
Trade Payable   1,584  
Bills payable   300  
Salaries and Wages 1,800  
 
Cash at Bank 678  
 
Inventory (1.4.2021) 792  
 
Rent and rates 1,389  
 
Sales return 294  
 
  16,362  16,362  
© The Institute of Chartered Accountants of India
4 FOUNDATION EXAMINATION: MAY, 2022 
Question 2 
(a) The Machinery Account of a Factory showed a balance of ` 95 Lakhs on 1
st
 April,2020. 
The Books of Accounts 
 Depreciation is written off of the Factory are closed on 31
st
 March every year and @ 10% 
per annum under the Diminishing Balance Method. On 1
st
 September,2020 a new machine 
was acquired at a cost of ` 14 Lakhs and ` 44,600 was incurred on the same day as 
installation charges for erecting the machine. On 1
st
 September,2020 a machine which had 
cost ` 21,87,000 on 1
st
 April,2018 was sold for ` 3,75,000. Another machine which had 
cost ` 21,85,000 on 1
st
 April,2019 was scrapped on 1
st
 September,2020 and it realized 
nothing. 
 Prepare Machinery Account for the year ended 31
st
 March,2021. Allow the same rate of 
depreciation as in the past and calculate depreciation to the nearest multiple of a rupee. 
Also show all the necessary working notes. (10 Marks) 
(b) Zed Enterprises furnishes the following information for the year ended 31st March,2021. 
Particulars Amount (`) 
Value of Stock as on 1st April,2020 
Purchases during the year 
Manufacturing Expenses during the year 
Sales during the year 
28,00,000 
1,38,40,000 
28,00,000 
2,08,80,000 
 The following further information is also provided: 
(i) At the time of valuing stock on 31
st 
March,2020 a sum of ` 2,40,000 was written off 
for a particular item which was originally purchased for ` 8,00,000. This item was sold 
during the year ended 31
st
 March,2021 for ` 6,40,000. 
(ii)  Except for the above transaction, the rate of gross profit during the year was 1/3rd on 
cost. 
Ascertain the value of Stock as on 31st March,2021. (5 Marks) 
(c)  From the following particulars, prepare a Bank Reconciliation Statement on 31
st
 March 
2021· 
Particulars Amount (`) 
Bank balance as per Pass Book 
Bills discounted dishonored not recorded in Cash Book 
Cheque received entered twice in Cash Book 
Bank charges entered twice in Cash Book 
Insurance premium paid directly by Bank under-standing instruction 
Cheque issued but not presented to Bank for payment 
25,00,000 
12,50,000 
25,000 
5,000 
1,50,000 
12,50,000 
© The Institute of Chartered Accountants of India
 PAPER – 1 : PRINCIPLES AND PRACTICE OF ACCOUNTING 5 
Cheque received, but not sent to Bank 
Cheque deposited in Bank, but no entry passed in the Cash Book 
Credit side of the Bank column cast short 
28,00,000 
12,50,000 
5,000 
(5 Marks) 
Answer  
(a)       Plant and Machinery Account for the year ended 31
st
 March,2021 
  `   ` 
01-04-20 To Balance b/d 95,00,000 01-09-20 By Bank (Sales) 3,75,000 
01-09-20 To Bank   
     (14,00,000 + 
      44,600) 
14,44,600 
 By Depreciation 
(on sold machine) 73,811 
    By Loss on sale 13,22,659 
    By Loss on 
scrapping the 
machine 
18,84,562 
    By Depreciation 
(on Scrapped 
machinery) 
81,938 
    By Depreciation 
(Note iii) 
6,60,471 
     By Balance c/d 65,46,159 
  109,44,600   109,44,600 
Working Note: 
(i) Calculation of loss on sale of machine on 01-09-2020   
   `  
 Cost on 1-4-2018  21,87,000 
 Less: Depreciation @ 10% on ` 21,87,000  (2,18,700) 
 W.D.V. on 31-03-2019  19,68,300 
 Less: Depreciation @ 10% on ` 19,68,300  (1,96,830) 
 W.D.V. on 31-03-2020  17,71,470 
 Less: Depreciation @ 10% on ` 17,71,470 for 5 
months 
 (73,811) 
   16,97,659 
 Less: Sale proceeds on 01-09-2020  (3,75,000) 
 Loss   13,22,659 
© The Institute of Chartered Accountants of India