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Kindly provide the answer A. An earth quake destroys a major ware house of Raj Ltd on 20th May 2020. The accounting year of a
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A. An earth quake destroys a major ware house of Raj Ltd on 20th May 2020. The accounting year of a company ended on 31st March 2020. The accounting was approved on 15th June 2020. The loss from earth quake estimated was Rs40 lakhs. State with reasons, whether the loss due to earth quake is an adjusting or non-adjusting event and how the fact of loss to be disclosed by the company. B. BobitaLtd. had a major break down in its plant in the month of February 2020. In the month of March it entered into an agreement with an engineering firm for the purpose of repairing its plant for a consideration of Rs 180 lakhs. The engineering firm started the repairing work in the month of April and completed it in the same month. Bobita Ltd. made the provision for said expenditure on repairs to its books of account for the financial year ended 31st March 2020 on the plea that the event of break down leading to repair expenditure had taken place. In the financial year, binding contract for repairs was entered into during the same financial year and repair work was also completed before the financial statements were approved by the company's board of directors. CommentStep by Step Solution
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