Question

From the following information, calculate Operating Profit before Working Capital Changes:

	₹
Net Profit before Tax and Extraordinary Items	4,47,000
Depreciation on Machinery	84,000
Interest on Borrowings	16,800
Goodwill Amortised	18,600
Loss on Sale of Furniture	18,000
Premium on Redemption of Preference Shares	6,000
Gain (Profit) on Sale of Investments	12,000
Interest and Dividend Received on Investments	27,600

Answer 1

		Cash Flow Statement  for the year ended March 31, ….
	Particulars		Amount (₹)	Amount (₹)
A	Cash Flow from Operating Activities
	Net Profit Before Taxation and Extraordinary Items			4,47,000
	Items to be Added:
	Depreciation on Machinery		84,000
	Loss on Sale of Furniture		18,000
	Interest on Borrowings		16,800
	Goodwill Amortized		18,600
				1,37,400
	Items to be Deducted:
	Profit on Sale of Investment		(12,000)
	Interest and Dividend Received on Investment		(27,600)	(39,600)
	Operating Profit before Working Capital Adjustments			5,44,800

 Note: Assuming Premium on Redemption of Preference Shares has been paid out of the Securities Premium Reserve Balance.