Loading Tutorstips...
✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Following was the Balance Sheet of M.M. Ltd. as at 31st March, 2025:
| Particulars | Note No. | 31st March, 2025 (₹) | 31st March, 2024 (₹) |
|---|---|---|---|
| I. EQUITY AND LIABILITIES | |||
| 1. Shareholders’ Funds | |||
| (a) Share Capital | 5,00,000 | 4,00,000 | |
| (b) Reserves and Surplus | 1 | 2,00,000 | (50,000) |
| 2. Non-Current Liabilities — Long-term Borrowings (12% Debentures) | 2 | 4,50,000 | 5,00,000 |
| 3. Current Liabilities | |||
| (a) Short-term Borrowings (Bank Overdraft) | 3 | 1,50,000 | 50,000 |
| (b) Short-term Provisions (Provision for Tax) | 4 | 70,000 | 90,000 |
| Total | 13,70,000 | 9,90,000 | |
| II. ASSETS | |||
| 1. Non-Current Assets | |||
| (a) Fixed Assets: (i) Tangible Assets (Note 5) | 10,03,000 | 7,20,000 | |
| (ii) Intangible Assets (Goodwill) | 6 | 20,000 | 30,000 |
| (b) Non-Current Investments | 1,00,000 | 75,000 | |
| 2. Current Assets | |||
| (a) Current Investments | 50,000 | 60,000 | |
| (b) Inventories | 7 | 1,07,000 | 45,000 |
| (c) Cash and Cash Equivalents | 90,000 | 60,000 | |
| Total | 13,70,000 | 9,90,000 | |
Note 5: Tangible Assets — Machinery: 12,03,000 (2025), 8,21,000 (2024); Less: Accumulated Depreciation: (2,00,000) (2025), (1,01,000) (2024); Net: 10,03,000 (2025), 7,20,000 (2024).
Additional Information:
1. 12% Debentures were redeemed on 31st March, 2025.
2. Tax ₹70,000 was paid during the year.
Prepare Cash Flow Statement.
Cash Flow Statement for the year ended 31st March, 2025
| I. Cash Flow from Operating Activities | ||
| Particulars | Amount (₹) | Amount (₹) |
|---|---|---|
| Net Profit before Tax and Extraordinary Items (2,00,000 − (−50,000)) | 2,50,000 | |
| Items to be Added: | ||
| Depreciation (2,00,000 − 1,01,000) | 99,000 | |
| Goodwill Written Off (30,000 − 20,000) | 10,000 | |
| Interest on Debentures (12% of 5,00,000, opening balance — redeemed only on the last day) | 60,000 | |
| Provision for Tax (WN, made during the year) | 50,000 | 2,19,000 |
| Operating Profit before Working Capital Changes | 4,69,000 | |
| Less: Increase in Inventories (1,07,000 − 45,000) | (62,000) | |
| Cash Generated from Operations | 4,07,000 | |
| Less: Tax Paid | (70,000) | |
| Net Cash Flow from Operating Activities | 3,37,000 | |
| II. Cash Flow from Investing Activities | ||
| Purchase of Fixed Assets (12,03,000 − 8,21,000) | (3,82,000) | |
| Purchase of Non-Current Investments (1,00,000 − 75,000) | (25,000) | |
| Net Cash Used in Investing Activities | (4,07,000) | |
| III. Cash Flow from Financing Activities | ||
| Proceeds from Issue of Share Capital (5,00,000 − 4,00,000) | 1,00,000 | |
| Redemption of Debentures (5,00,000 − 4,50,000) | (50,000) | |
| Interest Paid on Debentures | (60,000) | |
| Increase in Bank Overdraft (1,50,000 − 50,000) | 1,00,000 | |
| Net Cash Flow from Financing Activities | 90,000 | |
| IV. Net Increase in Cash and Cash Equivalents (I + II + III) | ||
| Net Increase in Cash and Cash Equivalents | 20,000 | |
| Add: Cash and Cash Equivalents at the beginning of the period (Includes Current Investments of 60,000) | 1,20,000 | |
| Cash and Cash Equivalents at the end of the period (Includes Current Investments of 50,000) | 1,40,000 | |
Working Note: Provision for Tax Account
| Particulars | Amount (₹) | Particulars | Amount (₹) |
|---|---|---|---|
| To Bank A/c | 70,000 | By Balance b/d | 90,000 |
| To Balance c/d | 70,000 | By Statement of Profit and Loss (balancing figure) | 50,000 |
| Total | 1,40,000 | Total | 1,40,000 |
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.
This guide covers "T.S. Grewal Class 12 Vol 3 Chapter 5 Q.45 - Cash Flow Statement", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 5 - Cash Flow Statement.
It is primarily curated for Class 11 and Class 12 high school commerce, accounting, and economics students, as well as aspirants preparing for board exams or CA Foundation.
You can take our custom-built interactive practice quiz directly on this page to test your understanding of "T.S. Grewal Class 12 Vol 3 Chapter 5 Q.45 - Cash Flow Statement" instantly.