Question

net value added at factor cost is equal to income generated addition in stock 1000,sales 10000, net indirect tax 800, purchase of raw materials 1650, expenses of power 850, consumption of fixed capital 500, rent 700, compensation of employees 3500, interest 1000,dividend 1500, corporate gain tax 300, undistributed profit 200​

Answer 1

Answer:

NVA AT FC= NDP AT FC=₹7,200 CRORES

Explanation:

WE NEED TO PROVE THAT

NVA AT FACTOR COST= NDP AT FACTOR COST

USING VALUE ADDED METHOD-

GVA AT MP=ADDITION TO STOCK +SALES-INTERMEDIATE CONSUMPTION(PURCHASE OF RAW MATERIAL- EXPENSES ON POWER)

GVA AT MP= 1000+10000-1650-850

GVA AT MP=₹8500 crores

NOW WE KNOW THAT,

NVA AT FC=GVA AT MP-CONSUMPTION OF FIXED CAPITAL-NET INDIRECT TAXES

NVA AT FC=8500-500-800

THEREFORE NVA AT FC=₹7,200 CRORES

NOW,USING INCOME METHOD-

NDP AT FC=RENT+COMPENSATION OF EMPLOYEES + INTEREST + DIVIDEND +CORPORATE GAIN TAX + UNDISTRIBUTED PROFITS

THEREFORE NDP AT FC=700+3500+1000+1500+300+200

NDP AT FC=₹7,200 CRORES

THEREFORE NVA AT FC=NDP AT FC= ₹7,200 CRORES

HENCE PROVED

Answer 2

Answer:

plz use blue pen in board exam not black