Read the following information to answer.

On the basis of case study given below, answer the question which follows:

"Mikku on alumni of IIT Delhi, initiated his start-up "Gajanan Ltd.," in the year 2016. His profit in the year 2020-21 after all appropriation was Rs. 6,25,000. This profit was arrived after taking following items into consideration:

| Loss on Sale of fixed Assets | Rs. 5,00,000 | | Goodwill written off | Rs. 3,80,000 | | Transfer to reserve | Rs. 3,55,000 | | Provision for tax | Rs. 2,70,000 | | Interest on Debentures paid | Rs. 1,65,000 |

Other Details are:

| Particulars | 2020 (in Rs.) | 2021 (in Rs.) | | Prepaid Expenses | 25,000 | 10,000 | | Accrued interest | 40,000 | 68,000 | | Trade payables | 7,00,000 | 4,00,000 | | Inventories | 6,50,000 | 5,50,000 |