Asset in doubtful category for 2 years – Rs. 500000/- Realization value of security – Rs. 300000/-

Asset in doubtful category for 2 years – Rs. 500000/- Realization value of security – Rs. 300000/- What will be the provision requirement? a. Rs. 500000/- b. Rs. 320000/- c. Rs. 200000/- d. Rs. 175000/- Ans - b Explanation Provision for secured portion of Doubtful Cat for 2 years = 40% Provision for unsecured portion of Doubtful Cat for 2 years = 100% Here, Secured portion = Rs. 300000 Unsecured portion = Rs. 200000 Provision = (300000 * 40/100) + 200000 = 120000 + 200000 = 320000