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revenues for financial year 2020-2021 is Rs. 25,00,000 and Rs. 30,00,000 p.a. for the remaining 3 years
thereafter.
(iii) On 4th July 2019, Super Sounds Limited was granted a Copyright that had been applied for by Music

Limited. During the financial year 2019-2020, Super Sound Limited incurred Rs. 2,50,000 on legal cost to
register the Patent and Rs. 7,00,000 additional cost to successfully prosecute a copyright infringement suit
against a competitor.
The life of the copyright is for 10 years.
Super Sound Limited follows an accounting policy to amortize all intangible on SLM (Straight Line Method)

basis or any appropriate basis over a maximum period permitted by relevant Ind AS, taking a full year
amortization in the year of acquisition.
You are required to prepare:
(i) A Schedule showing the intangible section in Super Sound Limited Balance Sheet as on 31st March 2020,
and

(ii) A Schedule showing the related expenses that would appear in the Statement of Profit and Loss of Super
Sound Limited for the year ended 2019-2020.
SOLUTION

i)
Super Sounds Limited
Balance Sheet (Extract relating to intangible asset) as at 31st March 2020
Note No. Rs.
Assets
(1) Non- current asset
Intangible assets 1 69,45,000

ii)
Super Sounds Limited
Statement of Profit and Loss (Extract)
for the year ended 31st March 2020
Note No. Rs.
Revenue from Operations 10,00,000
Total Revenue 10,00,000

Expenses:
Amortization expenses 2 16,25,000
Other expenses 3 7,20,000
Total Expenses 23,45,000

Notes to Accounts (Extract)

1. Intangible Assets
Gross Block (Cost) Accumulated amortisation Net block
Opening Additions Closing Opening Additions Closing Opening Closing
Balance balance Balance balance Balance balance
Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs.

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