Multiple choice

The book value of investment is Rs. 1, 20,000 and investment fluctuation fund is appearing at Rs. 15,000. The realisable value of investment is Rs. 1, 00,000. How to show this adjustment in revaluation account?

  1. Rs. 20000 will be debited ro revaluation account.

  2. Rs. 5,000 will be debited ro revaluation account.

  3. Rs. 20,000 will be credited to revaluation account.

  4. Rs. 5,000 will be credited to revaluation account.

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

It is the correct answer. The loss on investment is Rs. 20,000 but Rs. 15,000 will be adjusted from investment fluctuation fund and the rest will be debited to revaluation account.