Question 31 Chapter 5 of +2-B - USHA Publication 12 Class

Question 31 Chapter 5 of +2-B

Table of Contents

Indirect Method

31. (Cash Flow from Operating Activities) From the following Balance Sheets of ABC Ltd. find out cash from operating activity only :

Balance Sheet
Particulars	31st March, 2018	31st March, 2017
I.Equity and Liabilities
Shareholders Fund :
Equity Share Capital	35,000	30,000
Reserves and Surplus :
General Reserve	15,000	10,000
Balance in Statement of Profit and Loss	7,000	-6,000
Discount on Debentures		-500
Non-Current Liabilities :
10% Debentures	25,000	21,000
Current Liabilities :
Sundry Creditors	12,500	8,500
Provisions Provision for depreciation on Machinery	13,000	9,000
Total	1,07,500	72,000
II. Assets
Non-Current Assets :
Tangible Assets
Machinery	54,000	41,000
10% Investments	8,000	3,000
Intangible Assets :
Goodwill	8,000	10,000
Current Assets
Inventories	23,000	4,600
Input CGST	750	700
Input SGST	750	700
Cash and Cash Equivalents :
Cash and Bank	13,000	12,000
Total	1,07,500	72,000

The solution of Question 31 Chapter 5 of +2-B: –

Cash Flow from Operating Activities
Particulars		Rs
Net Profit as per Statement of Profit and Loss		13,000
Add: Transfer to General Reserve		5,000
		18,000
Add Non-Cash and Non-Operating items :
Interest on Debentures @10%	2,100
Depreciation	4,000
Goodwill amortized	2,000
Discount on debentures written off	500	8,600
		26,600
Less: Non-Operating incomes :
Interest on Investment		300
Operating Profit before the change in working capital		26,300
Add: Increase in liabilities
Creditors		4,000
		30,300
Less: Increase in current Assets
Inventories	(18,400)
Input CGST	(50)
Input SGST	(50)	18,500
Cash Flow from Operating activities		11,800