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Anand Ltd., Arrived at a Net Income of Rs 5,00,000 for the Year Ended March 31, 2017. Depreciation for the Year Was Rs 2,00,000. - Accountancy

Numerical

Anand Ltd., arrived at a net income of Rs 5,00,000 for the year ended March 31, 2017. Depreciation for the year was Rs 2,00,000. There was a profit of Rs 50,000 on assets sold which was transferred to Statement of profit and Loss account. Trade Receivables increased during the year Rs 40,000 and Trade Payables also increased by Rs 60,000. Compute the cash flow operating activities by the indirect approach.

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Solution

Cash Flow from Operating Activities as on March 31, 2017

Particulars

Amount

(₹)

Amount

(₹)

Net Profit during the year

 

5,00,000

Items to be adjusted:

 

 

 

Add: Depreciation

2,00,000

 

 

Less: Gain on sale of assets

(50,000)

1,50,000

Operating Profit before Working Capital changes

 

6,50,000

 

Add: Increase in Trade Payables

60,000

 

 

Less: Increase in Trade Receivables

(40,000)

20,000

Net Cash from Operations

 

6,70,000

  Is there an error in this question or solution?
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APPEARS IN

NCERT Class 12 Accountancy - Company Accounts and Analysis of Financial Statements
Chapter 6 Cash Flow Statement
Numerical Questions | Q 1 | Page 272
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