Question

From the following information, calculate Cash Flow from Investing and Financing Activities:

Particulars	31st March 2019 (₹)	31st March 2018 (₹)
Machinery (At cost)	50,000	40,000
Accumulated Depreciation	12,000	10,000
Capital	35,000	30,000
Bank Loan	...	10,000

During the year, a machine costing ₹ 10,000 was sold at a loss of ₹ 2,000. Depreciation on machinery charged during the year amounted to ₹ 6,000.

Answer 1

Cash Flow Statement for the year ended March 31, 2019
	Particulars	Amount (₹)	Amount (₹)
	Cash Flow from Investing Activities
	Purchase of Machinery	(20,000)
	Sale of Machine	4,000
	Net Cash from (used in) Investing Activities		(16,000)
	Cash Flow from Financing Activities
	Proceeds from Issue of Equity Shares	5,000
	Repayment of Bank Loan	(10,000)
	Net Cash from (used in) Financing Activities		(5,000)

Working Notes:

Machinery Account
Dr.		Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)
Balance b/d	40,000	Accumulated Depreciation A/c	4,000
Bank A/c (Purchase- Bal. Fig.)	20,000	Bank A/c (Sale)	4,000
		Profit and Loss A/c (Loss on Sale)	2,000
		Balance c/d	50,000
	60,000		60,000

 

Accumulated Depreciation Account
Dr.		Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)
To Machinery A/c (Bal. Fig.)	4,000	Balance b/d	10,000
Balance c/d	12,000	By Profit and Loss A/c (Dep. charged during the year)	6,000
	16,000		16,000