# Question 23 Chapter 5 of +2-B – USHA Publication 12 Class

Q-23- CH-5 Book 2 - Usha Publisher +2 Book 2019 - Solution

Question 23 Chapter 5 of +2-B

Indirect Method

23. (Cash Flow from Operating Activities/Acc. Dep. on Plant Sold) Calculate cash fib from operating activities from the following :

 Opening ₹ Closing ₹ Surplus i.e. balance in Statement of Profit and Loss 30,000 35,000 General Reserve 10,000 15,000 Provision for depreciation on Plant 30,000 35,000 Outstanding expenses 5,000 3,000 Goodwill 20,000 10,000 Trade Receivable 40,000 35,000

An item of a plant costing ₹ 20,000 having book value ₹ 14,000 was sold for 18,000 during the year.

## The solution of Question 23 Chapter 5 of +2-B: –

 Cash Flow from Operating Activities Particulars Rs Net Profit as per Statement of Profit and Loss 5,000 Add: Transfer to General Reserve 5,000 Net Profit before Income Tax 10,000 Add Non-Cash Items : Depreciation on Plant* 11,000 Goodwill wrote off 10,000 21,000 31,000 Less: Non-Operating income Profit on sale of Plant (4,000) Operating Profit before the change in Working Capital 27,000 Add: Decrease in Current Asserts Sundry Debtors 5,000 32,000 Less: Decrease in Current Liabilities Outstanding Expenses (2,000) Cash Flow from Operating activities 30,000

Working Note:

 Particulars Amount ₹ Particular Amount ₹ By Bal b/d 30,000 By Profit & Loss A/c – Depreciation (Bal. fig.) 5,000 To Bal c/d 35,000 35,000 35,000
 Increase in Depreciation Provision = 5,000 Add : Depreciation on Plant (₹ 20,000 – ₹ 14,000) = 6,000 Total Depreciation = 11,000

Also, Check out the solved question of previous Chapters: –

## Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

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