B Ltd. is engaged in many business including manufacturing and fitness clubs and sports gymnasium. It prepares its financial statements following…

B Ltd. is engaged in many business including manufacturing and fitness clubs and sports gymnasium. It prepares its financial statements following Indian Accounting. During the year, the company has faced some issues and for their solution seeks your professional advice. (i) A gymnasium enters into a contract with a new member to provide access to its gym for a 12-month period at 4,500 per month. The member can cancel his or her membership without penalty after three months. (ii) The following information is gathered from B Ltd.: Full capacity is 10,000 labour hours in a year.Normal capacity is 7,500 labour hours in a year.Actual labour hours for current period are 6,500 hours.Total fixed production overhead is 1,500.Total variable production overhead is 2,600.Total opening inventory is 2,500 units.Total units produced in a year are 6,500 units.Total units sold in a year are 6,700 units. The cost of inventories is assigned by using FIFO cost formula. Analyze the transactions mentioned above and choose the most appropriate option in the below questions 5 to 8 in line with relevant Ind AS: