T.S. Grewal Class 12 Vol 3 Chapter 5 Q.37 - Cash Flow Statement

Question 37

From the following information, calculate Cash Flow from Investing and Financing Activities:

Particulars	31st March, 2025 (₹)	31st March, 2024 (₹)
Machinery (At Cost)	50,000	40,000
Accumulated Depreciation	12,000	10,000
Capital	35,000	30,000
Bank Loan	–	10,000

During the year, a machine costing ₹10,000 was sold at a loss of ₹2,000. Depreciation on machinery charged during the year amounted to ₹6,000.

Solution

Cash Flow Statement for the year ended 31st March, 2025

Cash Flow from Investing Activities
Particulars	Amount (₹)	Amount (₹)
Purchase of Machinery (WN1)	(20,000)
Sale of Machine	4,000
Net Cash Used in Investing Activities		(16,000)
Cash Flow from Financing Activities
Additional Capital Introduced (35,000 − 30,000)	5,000
Repayment of Bank Loan	(10,000)
Net Cash Used in Financing Activities		(5,000)

Working Note 1: Machinery Account

Particulars	Amount (₹)	Particulars	Amount (₹)
To Balance b/d	40,000	By Accumulated Depreciation A/c	4,000
To Bank A/c (Purchase, balancing figure)	20,000	By Bank A/c (Sale)	4,000
		By Statement of Profit and Loss (Loss on Sale)	2,000
		By Balance c/d	50,000
Total	60,000	Total	60,000

Working Note 2: Accumulated Depreciation Account

Particulars	Amount (₹)	Particulars	Amount (₹)
To Machinery A/c (balancing figure)	4,000	By Balance b/d	10,000
To Balance c/d	12,000	By Statement of Profit and Loss (Depreciation charged during the year)	6,000
Total	16,000	Total	16,000