Zen is the owner of Mine A$,$ located in Gujarat. He entered a royalty agreement with Kapoor Ltd$.$ As per the agreement, the minimum rent is Rs $5,00,000$ and the Royalty amount is Rs $100$ per ton of production every month. The output in various years is as follows:

$2017$: $4000$ tons

$2018$: $5000$ tons

$2019$: $6000$ tons

Royalties Accounting Entries in Books of Lessee $($Kapoor Ltd$.)$

Case I: When Minimum Rent Exceeds Actual Royalty Amount $(2017)$

Case$-$II: When Minimum Rent Equals Actual Royalty Amount $(2018)$

When Royalty is Due

Case III: When Actual Royalty Amount is More Than Minimum Rent and Short Working is Recouped $(2019)$

Pass Royalties Accounting Entries in Books of Lessee $($Kapoor Ltd$.)$