Question

From the following Balance Sheet of Computer India Ltd., prepare a cash flow statement.

(Rs. in ‘000)
Particulars	Note No.	31st March 2017 (Rs.)	31st March 2016 (Rs.)
I. Equity and Liabilities
1. Shareholders’ Funds
a) Share capital		52,000	40,000
b) Reserve and surplus–Surplus	1	9,500	8,000
2. Non-Current Liabilities
10% Debentures		6,500	6,000
3. Current liabilities
a) Short-term borrowings	2	6,000	12,500
b) Trade payables		11,000	12,000
c) Short-term provisions	3	4,200	3,000
Total		90,000	81,500
II. Assets
1. Non-current assets
a) Fixed assets	4	27,000	30,000
2. Current assets
a) Inventories		35,000	30,000
b) Trade receivables		24,000	20,000
c) Cash and cash equivalents–cash		3,500	1,200
d) Other current assets–prepaid exp.		500	300
Total		90,000	81,500

Notes to Accounts:

Particulars	31st March 2017 (Rs.)	31st March 2016 (Rs.)
1. Reserve and surplus
i) Balance in statement of profit and loss	7,000	6,000
ii) General reserve	2,500	2,000
	9,500	8,000
2. Short-term borrowings
Bank overdraft	6,800	12,500
3. Short-term provisions
i) Provision for taxation	4,200	3,000
4. Fixed Assets:
Fixed Assets	42,000	41,000
Less Accumulated Depreciation	(15,000)	(11,000)
	27,000	30,000

Additional Information:

Proposed dividend for the year 2015-16 is Rs. 2,50,00,000

Answer 1

Cash Flow Statement of Computer India Ltd. For the year ended March 31, 2017
Particulars		Amount (Rs. in '000)	Amount (Rs. in '000)
A.	Cash Flows from Operating Activities
	Profit as per Balance Sheet	1,000
	Add: Proposed dividend Previous year (2016)	5,000
	Add: General reserve	500
	Add: Provision for taxation Current Year (2017)	4,200
	Net profits before taxation and extraordinary items		10,700
	Adjustments
	Add: Provision for Depreciation	4,000
	Add: Interest on 10% Debentures	600	4,600
	Operating Profit Before Working Capital Changes		15,300
	Adjustments for Working Capital changes:
	(-) Increase in Current Assets
	Trade receivables	(4,000)
	Inventories	(5,000)
	Other current assets	(200)
	(-) Decrease in Current Liabilities
	Trade payable	(1,000)	(10,200)
	Cash from operating activities		5,100
	Less: Income tax paid		(3,000)
	Net Cash from operating activities		2,100
B.	Cash Flow from Investing Activities
	Purchase of fixed assets	(1,000)
	Net cash inflow from Investing Activities		(1,000)
C.	Cash Flow from Financing Activities
	Add: Proceeds from issue of Equity Shares	12,000
	Add: Proceeds from issue of 10% Debentures	500
	Less: Interest paid on Debentures	(600)
	Less: Dividend paid	(7,000)
	Net cash from Financing Activities		4,900