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From the Following Balance Sheet, Prepare Cash Flow Statement: - Accountancy

Numerical

From the following Balance Sheet, prepare Cash Flow Statement:

Particulars

Note No.

31st March, 2019

(₹)

31st March, 2018

(₹)

I. EQUITY AND LIABILITIES      

1. Shareholders' Funds

     

  (a) Share Capital

  2,50,000 2,00,000

  (b) Reserves and Surplus,

1 90,600 80,500

2. Current Liabilities

     

  (a) Short-term Borrowings: Bank Loan

  ... 70,000

  (b) Trade Payables

  1,35,200 1,50,000

  (c) Short-term Provisions: Provision for Tax

  35,000 30,000

Total      Total Expenses

  5,10,800 5,30,500
II. ASSETS      

1. Non-Current Assets

     

Fixed Assets:

     

(i) Tangible Assets

2 3,59,000 3,50,000

(ii) Intangible Assets: Goodwill

  5,000 ...

2. Current Assets

     

 (a) Inventories

  74,000 1,00,000

 (b) Trade Receivables

  64,200 80,000

 (c) Cash and Cash Equivalents

  8,600 500

Total

  5,10,800 5,30,500

Notes to Accounts

Particulars

31st March, 2019

(₹)

31st March, 2018

(₹)

I. Reserves and Surplus    

   General Reserve

60,000 50,000

    Surplus, i.e., Balance in Statement of Profit and Loss

30,600 30,500

 

90,600 80,500
2. Tangible Assets    

     Land and Building

1,90,000 2,00,000

     Plant and Machinery

1,69,000 1,50,000
  3,59,000 3,50,000

Additional Information:
1. Proposed Dividend for the year ended 31st March, 2019 was ₹ 25,000 and for the year ended 31st March, 2018 was ₹ 14,000.
2. Interim Dividend paid during the year was ₹ 9,000.
3. Income Tax paid during the year was ₹ 28,000.
4. Machinery was purchased during the year ₹ 33,000.
5. Depreciation to be charged on machinery ₹ 14,000 and building ₹ 10,000.

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Solution

Cash Flow Statement

for the year ended March 31, 2019 

 

Particulars

Amount

(₹)

Amount

(₹)

A

Cash Flow from Operating Activities

 

 

 

Profit as per Statement of Profit and Loss (30,600 – 30,500)

100

 

 

Proposed Dividend

23,000

 

 

Transfer to General Reserve

10,000

 

 

Provision for Taxation

33,000

 

 

Profit Before Taxation

66,100

 

 

Items to be Added:

 

 

 

Depreciation on Machinery

14,000

 

 

Depreciation on Building

10,000

 

 

Operating Profit before Working Capital Adjustments

90,100

 

 

Add: Decrease in Current Assets

 

 

 

Inventories

26,000

 

 

Trade Receivables

15,800

 

 

Less: Decrease in Current Liabilities

 

 

 

Trade Payables

(14,800)

 

 

Cash Generated from operations

1,17,100

 

 

Less: Tax Paid

(28,000)

 

 

Net Cash Flows from Operating Activities

 

89,100

 

 

 

 

B

Cash Flow from Investing Activities

 

 

 

Purchase of Machinery

(33,000)

 

 

Purchase of Goodwill

(5,000)

 

 

Net Cash from (used in) Investing Activities

 

(38,000)

 

 

 

 

C

Cash Flow from Financing Activities

 

 

 

Proceeds from Issue of Equity Shares

50,000

 

 

Repayment of Bank Loan

(70,000)

 

 

Dividend Paid

(23,000)

 

 

Net Cash Used in Financing Activities

 

(43,000)

 

 

 

 

D

Net Increase in Cash and Cash Equivalents

 

8,100

 

Add: Cash and Cash Equivalent in the beginning of the period

 

500

 

Cash and Cash Equivalents at the end of the period

 

8,600

Working Notes:
WN1

Machinery Account

Dr.

Cr.

Particulars

Amount

(₹)

Particulars

Amount

(₹)

Balance b/d

1,50,000

Depreciation

14,000

Bank A/c (Purchases- Bal. Fig.)

33,000

Balance c/d

1,69,000

 

1,83,000

 

1,83,000

WN2

Provision for Taxation Account

Dr.

Cr.

Particulars

Amount

(₹)

Particulars

Amount

(₹)

Bank A/c (Tax Paid)

28,000

Balance b/d

30,000

Balance c/d

35,000

Profit and Loss A/c (Bal. Fig.)

33,000

 

63,000

 

63,000

Concept: Preparation of Cash Flow Statement
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APPEARS IN

TS Grewal Class 12 Accountancy - Analysis of Financial Statements
Chapter 4 Cash Flow Statement
Exercise | Q 52 | Page 114
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