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#12: Question of the day (Inter)
Accountancy
answered on 16-Aug-22 21:14
Write the answer in a sheet as you would write in exam and send photo by 8pm. #LetsPractice U Limited has obtained a term loan of Rs. 620 lacs for a complete renovation and modernization of its Factory on 1st April, 2020. Plant and Machinery was acquired under the modernization scheme and installation was completed on 30th April, 2021. An expenditure of Rs. 564 lacs was incurred on this Plant and Machinery and the balance loan of Rs. 56 lacs has been used for working capital purposes. The company has paid total interest of Rs. 68.20 lacs during financial year 2020-2021 on the above loan. The accountant seeks your advice how to account for the interest paid in the books of accounts. Will your answer be different, if the whole process of renovation and modernization gets completed by 28th February, 2021?
latest answer
Correct answer: Rs. 62.04 lakh to be capitalised and Rs. 6.16 lakh to be charged to Profit and Loss Account. If the whole process of renovation and modernization gets completed by 28th February, 2021; P&M will not be considered as qualifying asset. In that case, entire interest to be charged to P&L. For details, please refer the pic below.
Sahibdeep Singh
CA Inter
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Co account
Accountancy
answered on 17-Aug-22 16:46
What is reserve capital with understanding example
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Always welcome
Deepa
CA Inter
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10
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Plse check me
Accountancy
answered on 15-Aug-22 17:38
as per Accounting standard 2 valuation of inventories, valuation of raw material..cost of raw material or replacement value whichever is lower we should have to take that lower amount am I correct?? for an example the raw material cost is RS 1000 but the replacement cost Rs 600 means we should have to take lower value to value the raw material rupees 600 am I correct?? does replacement cost and market price both same?? plse guide me
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Raw materials are always valued at cost. However, If raw material prices are falling down and finished goods are expected to be sold at below cost i.e their NRV is less than the cost then raw material will be valued at NRV and replacement cost of raw materials is the best measure of their NRV. Replacement Cost is the cost we will incur if we buy the raw material today.
MPR Sanjay Kumar
CA Inter
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Is enough time is remaining for ca foundation
Accountancy
answered on 14-Aug-22 12:45
Can I still start my preparation for dec 22 ca foundation is there enough time for it
latest answer
Study planner is very much helpful
Atharv Sankliya
CA Final
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7
368
Is enough time is remaining for ca foundation
Accountancy
answered on 14-Aug-22 12:45
Can I still start my preparation for dec 22 ca foundation is there enough time for it
latest answer
Very much yes, if you focus from right now
Atharv Sankliya
CA Final
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11
425
My honourable Suraj lakhotia sir plse check me
Accountancy
answered on 16-Aug-22 09:51
For an example : If the Raw material cost is RS 500 on this raw material partly maked some goods that worth is RS 600 ( finished goods) ..here I have to value which value ??? The market price of material is RS 450 Here which price I have to valuation of inventories.. Replacement cost when I have to use?? Plse guide me
latest answer
Yes - if FG are expected to be sold below cost.
MPR Sanjay Kumar
CA Inter
★ 530
3
454
Bank Reconciliation Statement
Accountancy
answered on 13-Aug-22 17:59
What is the meaning of credit side of bank column cast short What is the effect on cash book
latest answer
Bank is a real account so " Debit what comes in " and " Credit what goes out" ......in bank statement debit represents all incomes and receipt ..credit side is all expenses payment
Rishi jain
CA Final
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458
Please explain me
Accountancy
answered on 16-Aug-22 10:04
Could you please explain me this short clearly my dear friends
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Thank you so much my honourable CA sir
MPR Sanjay Kumar
CA Inter
★ 530
5
363
Profit or loss pre and post incorporation
Accountancy
answered on 13-Aug-22 21:57
When both date of incorporation and date of commencement of business given. Which one will be considered ?
latest answer
My honourable sir ,I watched the link video
Surya Ravi
CA Final
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3
398
Financial statement of a company
Accountancy
answered on 13-Aug-22 14:03
In illustration 1 of icai material why is debenture interstellar not shown in current liability in the balance sheet
latest answer
interest in tb means both expense and payment entry is done.
Shriram Ravichandran
ACCA Skill
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433