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From the following information, calculate Cash Flow from Operating Activities:
| Particulars | 31st March, 2024 (₹) | 31st March, 2025 (₹) |
|---|---|---|
| Equity Share Capital | 20,00,000 | 30,00,000 |
| 10% Preference Share Capital | 2,00,000 | 1,00,000 |
| Securities Premium | – | 95,000 |
| Surplus, i.e., Balance in Statement of Profit & Loss | 4,00,000 | 8,00,000 |
| 10% Debentures | 10,00,000 | 10,00,000 |
Additional Information:
(i) Preference shares were redeemed on 31st March, 2025 at a premium of 5%.
(ii) Dividend on equity shares was paid @ 8%.
(iii) Fresh issue of equity shares was made on 1st April, 2024.
| Particulars | Amount (₹) |
|---|---|
| Surplus, i.e., Balance in Statement of Profit and Loss (8,00,000 − 4,00,000) | 4,00,000 |
| Add: Dividend paid on Equity Shares @ 8% of 30,00,000 (full year, issued 1st April, 2024) | 2,40,000 |
| Add: Dividend paid on 10% Preference Shares (10% of 2,00,000) | 20,000 |
| Profit before Tax and Extraordinary Items | 6,60,000 |
| Add: Interest on 10% Debentures (10% of 10,00,000) | 1,00,000 |
| Cash Flow from Operating Activities | 7,60,000 |
Note: Interest on Debentures is a Financing charge that reduced Surplus this year but is not an Operating outflow, so it is added back (not deducted) to arrive at Cash Flow from Operating Activities. The Preference Share redemption premium and Securities Premium arising from the fresh equity issue are both Financing Activity items and do not enter this computation.
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.
This guide covers "T.S. Grewal Class 12 Vol 3 Chapter 5 Q.15 - Cash Flow Statement", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 5 - Cash Flow Statement.
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