Read the following information provided by a school and attempt Question:

The Trial Balance of a school as on 31.3.2017 is

Additional Information:

The book value of the furniture sold was ₹50,000 on April 1, 2016 was sold for ₹20,000.

What amount of Interest on investment will be credited to Income and Expenditure account.

₹60,000

The correct answer is Option (1) → ₹60,000.

Investment @12% (1.4.16) = 5,00,000
Interest = 5,00,000 x 12/100
             = 60,000

60,000 IS CREDITED TO INCOME AND EXPENDITURE ACCOUNT.