Rs. 19,500 debited to building repairs on 31st December 1993 included Rs. 9,500 as the cost of building a small room for the watch man. A bill of Rs. 800 for colour wash of the whole building during the year was not received till 1993 December. The amount to be debited to profit and loss account would be:
A. Rs. 20,300
B. Rs. 19,500
C. Rs. 10,800
D. Rs. 9,500
Answer: Option C
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C is the correct answer because out of 19500, Rs 9500 is for building office quarter for Watchman which should be recorded as Building in assets side. So remaining Rs 10000 is for repair and maintenance of office building plus 800 for painting. Total to be deducted from PL account is Rs 10800.