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Question 34 Chapter 15 of Class 12 Part – 2 – 2024
Indirect Method
34. (Cash Flow from Operating Activities) Calculate cash flow from operating activities from the following :
(i) Profit made during the year 2,50,000 after considering the following items :
| ₹ | |
| (a) Depreciation | 10,000 |
| (b) Amortisation of Goodwill | 5,000 |
| (c) Transfer to General Reserve | 7,000 |
| (d) Profit on sale of land | 3,000 |
| Closing Balance | Opening Balance | |
| Trade Receivable | 23,000 | 23,000 |
| Trade Payable | 10,000 | 15,000 |
| Inventories | 8,000 | 10,000 |
| Prepaid expenses | 4,000 | 6,000 |
| 12% Debentures | 1,00,000 | 1,00,000 |
Cash Flow from Operating Activities
| Particulars |
Rs |
|
|---|---|---|
| Net Profit as per Statement of Profit & Loss | 2,50,000 | |
| Adjustment of Non-Operating & Non Cash items | ||
| Add: Depreciation | 10,000 | |
| Goodwill wrote off | 5,000 | |
| General Reserve | 7,000 | |
| Less: Profit on sale of land | 3,000 | |
| Add: Interest on Debentures | 12,000 | 22,000 |
| Cash from operating activities before change in working capital | 2,81,000 | |
| Add: Decrease in Current Assets : | ||
| Inventories | 2,000 | |
| Prepaid Expenses | 2,000 | |
| Less: Decrease in Current Liabilities | ||
| Trade Payables | 5,000 | (1,000) |
| Cash Flew from Operating activities | 2,80,000 | |
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
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