Question

Investments valued ₹ 2,00,000 were not shown in the books. One of the creditors took over these investments in full satisfaction of his debt of ₹ 2,20,000. How much amount will be deducted from creditors?

विकल्प

• ₹ 20,000

• ₹ 2,20,000

• ₹ 4,20,000

• ₹ 2,00,000

Answer 1

₹ 2,20,000

Explanation:

Investments not shown in the books = ₹ 2,00,000

Creditor’s debt = ₹2,20,000

Creditor took over investments in full satisfaction of debt

Value of asset taken over: ₹ 2,00,000

Creditor’s claim: ₹ 2,20,000

If the creditor accepts the investments in full satisfaction of his debt, it means the creditor agrees that taking ₹ 2,00,000 of investments settles the full debt.

Therefore, the entire creditor’s account (₹ 2,20,000) is cleared.

There is no cash paid or remaining balance to the creditor.

Hence, the amount to be deducted from creditors in the books is the full debt: ₹ 2,20,000.