Moon Oil Exploration Ltd. (MOEL) was incorporated on 1st June 2007 and the company made a considerable amount of profit in the past years: Financial Year Net Profit 2016-17 ₹25 Crore 2017-18 ₹10 Crore 2018-19 ₹12 Crore.
CS Executive · Company Law · PYQS · December 2019
Moon Oil Exploration Ltd. (MOEL) was incorporated on 1st June 2007 and the company made a considerable amount of profit in the past years: Financial Year Net Profit 2016-17 ₹25 Crore 2017-18 ₹10 Crore 2018-19 ₹12 Crore. A sum of ₹2 lakh was spent by MOEL on an advertisement in a tract published by a political party? How it is to be treated in the accounts of the company?
Answer & Explanation:
If the expenditure incurred on advertisement in any publication souvenir, brochure, tract, pamphlet or the like is deemed as political contribution if such publication is by or on behalf of political party or if not, then for the advantage to such political party for a political purpose. Hence, this amount to be treated as political contribution and shown in profit and loss account under the head political contribution.
Topics: Company Law
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