Question

Following is the Balance Sheet of Fine Products Ltd. as at 31st March, 2019

Particulars	Note No.	31st March, 2019 (₹)	31st March, 2018 (₹)
I. EQUITY AND LIABILITIES :
1. Shareholders' Funds
(a) Share Capital: Equity Share Capital		3,50,000	3,00,000
(b) Reserves and Surplus	1	57,000	38,000
2. Current Liabilities :
(a) Trade Payables		53,000	35,000
(b) Other Current Liabilities		6,000	8,000
(c) Short-term Provisions	2	32,000	28,000
Total		4,98,000	4,09,000
II. ASSETS :
1. Non-Current Assets :
(a) Fixed Assets:
(i) Tangible Assets	3	2,48,000	2,00,000
(ii) Intangible Assets (Goodwill)		40,000	50,000
(b) Non-Current Investments		35,000	10,000
2. Current Assets :
(a) Inventories		39,000	57,000
(b) Trade Receivables		1,08,000	75,000
(c) Cash and Bank Balance		28,000	17,000
Total		4,98,000	4,09,000

Notes to Accounts

Particulars	31st March, 2019 (₹)	31st March, 2018 (₹)
1. Reserves and Surplus
General Reserve	30,000	20,000
Surplus, i.e.,Balance in Statement of Profit and Loss	27,000	18,000
	57,000	38,000
2. Short-term Provisions
Provision for Tax	32,000	28,000
3. Tangible Fixed Assets
Land and Building	57,000	1,10,000
Plant and Machinery	1,91,000	90,000
	2,48,000	2,00,000

Note: Proposed dividends on equity for the years ended 31st March, 2018 and 2019 are ₹ 39,000 and ₹ 45,000 respectively. You are required to prepare Cash Flow Statement for the year ended 31st March, 2019.

Answer 1

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			9,000
	Items to be Added:
	General Reserve		10,000
	Goodwill		10,000
	Provision for Taxation		32,000
	Proposed Dividend		39,000	1,00,000
	Operating Profit before Working Capital Adjustments			1,00,000
	Less: Increase in Current Assets
		Trade Receivables	(33,000)
	Less: Decrease in Current Liabilities
	Other Current Liabilities		(2,000)
	Add: Decrease in Current Assets
	Inventories		18,000
	Add: Increase in CurrentLiabilities
	Trade Payables		18,000	1,000
	Cash Generated from Operations			1,01,000
	Less: Tax Paid			(28,000)
	Net Cash Flows from Operating Activities			73,000
B	Cash Flow from Investing Activities
	Purchase of Non-Current Investments			(25,000)
	Purchase of Plant & Machinery			(1,01,000)
	Sale of Land & Building			53,000
	Net Cash Used in Investing Activities			(73,000)
C	Cash Flow from Financing Activities
	Dividend Paid			(39,000)
	Proceeds from Issue of Share Capital			50,000
	Net Cash Flow from Financing Activities			11,000
D	Net Increase or Decrease in Cash and Cash Equivalents			11,000
	Add: Cash and Cash Equivalent in the beginning of the period			17,000
	Cash and Cash Equivalents at the end of the period			28,000

Note: Proposed Dividend treatment is as per AS-4 (Revised).