Question

Which of the following transactions will result in 'Flow of Cash'?

Options

• Deposited ₹ 10,000 into the bank.

• Withdrew cash from bank ₹ 14,500.

• Sale of machinery of the book value of ₹ 74,000 at a loss of ₹ 9,000.

• Converted ₹ 2,00,000 of 9% debentures into equity shares.

Answer 1

Sale of machinery of the book value of ₹ 74,000 at a loss of ₹ 9,000.

Explanation:

Cash deposits, withdrawals, and conversions of debentures into equity shares do not result in a cash flow because there is no cash inflow or outflow in these activities.