Question

Parth has an accounting year ending on 31st March. He receives rent quarterly in advance amounting Rs. 45,000 on 1 January, 1 April, 1 July and 1 October but for the current year, he received the rent on 31st March instead for 1st April. What shall be the amount of rental income to be recorded in the profit & loss account for the year?

• A. Rs. 45,000
• B. Rs. 90,000
• C. Rs. 1,80,000
• D. Rs. 2,25,000

Answer 1

The correct option is C

Rs. 1,80,000

Income from rent to be recorded shall be Rs. 45,000 x 4 = Rs. 1,80,000.