Advait Ltd. has ₹8,00,000 as General Reserve on 31st March 2022 and they incurred a loss of ₹10,00,000 during the year ending 31st March 2023. What amount will be shown under reserves and surplus?
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → ₹(2,00,000)
A loss (debit balance of the Statement of Profit and Loss) is shown as a negative figure under Surplus, and the total of Reserves and Surplus is shown after adjusting it, even if the result is negative.
General Reserve = ₹8,00,000
Surplus (loss) = −₹10,00,000
Reserves and Surplus = 8,00,000 − 10,00,000 = ₹(2,00,000)
NCERT (2026-27 edition):
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