Question

On Arti's retirement,stock appeared in the books of the firm at Rs. 160000 and Machinery at Rs. 500000. On revaluation, it was found that stock is undervalued by 20% and Machinery is overvalued at 25%. There were bad debts amounting to Rs. 10000. Loss on revaluation will be? ​

Answer 1

Profit on revaluation will be Rs 83,000

Explanation:

                               

                                          Revaluation Account

To Stock                             32,000                            By Machinery    1,25,000

To Bad debts                    10,000

To Profit on Revaluation 83,000 (Bal Figure)

**** Reduction in the value of stock  (160000*20/100=32000)

      Increase in the value of Machinery (500000*25/100=125000)

Answer 2

7800

103000

9500

70000

Explanation:

why my answers is wrong