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    Question

    Vidya Ltd invested its idle cash into equity shares of X

    Ltd by buying 1,000 shares at ₹120 per share and paying Brokerage and taxes amount ing to ₹10,000. At year-end, the fair market value of the investment was ₹1,05,000. As per AS 13, what amount should be shown as the value of current investment in the balance sheet of Vidya Ltd ?   
    A ₹1,20,000 Correct Answer Incorrect Answer
    B ₹1,30,000 Correct Answer Incorrect Answer
    C ₹1,25,000 Correct Answer Incorrect Answer
    D ₹1,05,000 Correct Answer Incorrect Answer
    E ₹1,15,000 Correct Answer Incorrect Answer

    Solution

    Explanation:    
    As per AS 13, current investments are carried at lower of cost and fair value .   

    • Cost = (1,000 × ₹120) + ₹10,000 = ₹1,30,000   
    • Fair value = ₹1,05,000   
      Hence, value in books = ₹1,05,000  

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