Given:
Sundry Assets = 8,50,000
Realisation = 80%
Step 1: Realised Value of Assets
Realised amount = 8,50,000 × 80%
= 6,80,000
Loss on assets = 8,50,000 − 6,80,000
= 1,70,000
Step 2: Unrecorded Liability
Paid = 40,000
Step 3: Realisation Expenses
Expenses = 30,000
Step 4: Total Loss on Realisation
Total Loss =
1,70,000 + 40,000 + 30,000
= 2,40,000
Final Answer:
Loss ₹2,40,000 (Option 1)