Question

Compute cash from operations from the following figures:

(i) Profit for the year 2016-17 is a sum of Rs. 10,000 after providing for depreciation of Rs. 2,000.

(ii) The current assets and current liabilities of the business for the year ended March 31, 2016 and 2015 are as follows:

Particular	March 31, 2016 (Rs)	March 31, 2017 (Rs)
Trade Receivables	14,000	15,000
Provision for Doubtful Debts	1,000	1,200
Trade Payables	13,000	15,000
Inventories	5,000	8,000
Other Current Assets	10,000	12,000
Expenses payable	1,000	1,500
Prepaid Expenses	2,000	1,000
Accrued Income	3,000	4,000
Income received in advance	2,000	1,000

Answer 1

Cash Flow Statement

for the Year Ending March 31, 2017

Particulars	Details (₹)	Amount (₹)
Cash from Operating Activities
Net Profit		10,000
Items to be added:
Depreciation	2,000	2,000
Operating Profit before Working Capital Adjustments		12,000
Less: Increase in Current Assets
Trade Receivables	(1,000)
Accrued Income	(1,000)
Accrued Income	(2,000)
Other Current Assets	(3,000)
Inventories
Add: Increase in Current Liabilities
Provision for Doubtful Debts	200
Trade Payables	2,000
Expense Payable	500
Add: Decrease in Current Assets
Prepaid Expenses	(1,000)
Less: Decrease in Current Liabilities
Income received in advance	1,000
Net Cash From Operating Activities		7,700