SET OFF, CARRY FORWARD & SET OFF

Assume that I have a business loss & unabsorbed deprecaition in current year. I also have Business loss in last year too which is remain to be set off from current year. However, I have only such profit in Non-Speculative Business to set off :-

1. Business Profit & some of the unabsorbed depreciation.

2. Business Profit of Current Year & some of the last year unadjusted profit.

Please reply, whether option 1 is most appropriate or 2nd one.

Is there is another solution of above problem.