# Question 23 Chapter 8 -Unimax Publication Class 12 Part 2 – 2021

Question no 23 Chapter no 8 unimax class12 part 2

Question 23 Chapter 8 – Unimax Publication Class 12 Part 2 – 2021

23. from the following information calculate the amount of cash flows from investing activities:

 Particulars 31.3.2021 ₹ 31.3.2022 ₹ Plant and machinery 8,50,000 10,00,000 Non-current investment 40,000 1,00,000 Land (at cost) 2,00,000 1,00,000

(i)depreciation charged on plant and machinery was 50,000.
(ii) plant and machinery with a book value of 60,000 was sold for 40,000.
(iii)land was sold at a gain of 60,000.

## The solution of Question 23 Chapter 8 – Unimax Publication Class 12 Part 2-2021 : –

Calculation of cash from investing activities

 Particulars ₹ Sale of plant and machinery 40,000 Sale of land *(W. note 1) 1,60,000 Purchased of plant & machinery (W. note 2) (2,60,000) Purchase of non-current investments (60,000) Net cash flow from investing activities (1,20,000)

Working notes:

Plant & machinery account

 Particulars ₹ Particulars ₹ To balance b/d 8,50,000 By depreciation 50,000 To bank By bank (sale of machinery) 40,000 (Purchase of machinery) (bal. fig.) 2,60,000 By loss on sale of machinery 20,000 By balance c/d 10,00,000 11,10,000 11,10,000

Land account

 Particulars ₹ Particulars ₹ To balance b/d 2,00,000 By bank (sale of land) (b. fig. 1,60,000 To gain on sale of land 60,000 By balance c/d 1,00,000 2,60,000 2,60,000

Comment if you have any Doubts.

What is the cash flow statement? why do we need to prepare?