Question

Gopal Mining Co. Ltd. Took a mine on a lease at a Royality of
Rs. 1 perton. The minimum rent was fixed at Rs. 4,000 for
first year, Rs. 6,000 for seccond year and Rs. 8,000 per year
thereafter. Short workings of any year could be recouped
out of the Royalities of next two years only. The production
during the first 5 years was as follows:


Year Output in
tones
1 2,000
2 4,500
3 6,000
4 9,000

Pass the necessary Journal entries in the books of Gopal
Mining Co. Ltd.

Answer 1

Answer:

Gopal Mining Co. Ltd. Took a mine on a lease at a Royality of

Rs. 1 perton. The minimum rent was fixed at Rs. 4,000 for

first year, Rs. 6,000 for seccond year and Rs. 8,000 per year

thereafter. Short workings of any year could be recouped

out of the Royalities of next two years only. The production

during the first 5 years was as follows:

Year Output in

tones

1 2,000

2 4,500

3 6,000

4 9,000

Pass the necessary Journal entries in the books of Gopal

Mining Co. Ltd.