Model: Provision to be created Best Bank Ltd. had extended the following credit lines to a small-scale industry, which had paid any interest since March 2009:
Particulars |
Term Loan |
Export Credit |
Balance Outstanding on 31 March 2011 |
Rs.90,00,000 |
Rs.70,00,000 |
DICGC/ECGC Cover |
50% |
40% |
Securities Held |
Rs.40,00,000 |
Rs.30,00,000 |
Realizable Value of Securities |
Rs.30,00,000 |
Rs.20,00,000 |
Compute the necessary provisions to be made for the year ended on 31 March 2011.