Question 31 Chapter 8 -Unimax Publication Class 12 Part 2

Question 31 Chapter 8 – Unimax Publication Class 12 Part 2 – 2021

Table of Contents

The solution of Question 31 Chapter 8 – Unimax Publication Class 12 Part 2-2021 : –

Unimax Publication – Accountancy PSEB Class 12 – Volume I – Solution

Unimax Publication – Accountancy PSEB (Class 12) – Part – II – Solution

31.from the following information calculate net cash flow from operating activities and investing activities:

Particulars	31-3-2021	31-3-2022
Profit and loss A/c	1,00,000	4,00,000
Provision for tax	30,000	30,000
Trade payables	40,000	1,50,000
Current assets (inventories & trade receivables	4,60,000	5,20,000
Fixed assets	8,50,000	9,32,000
Accumulated depreciation	4,25,000	4,40,000

Additional information: depreciation amounting to 1,45,000 was provided during the current year and a machine costing 2,10,000 was sold at a profit of 16,000. Tax paid during the year was 30,000.

The solution of Question 31 Chapter 8 – Unimax Publication Class 12 Part 2-2021 : –

Calculation of net cash flow from operating &
Investing activities

Particulars		₹
I. Cash flow from operating activities
A.net profit before tax		3,30,000
B. add: depreciation		1,45,000
Less: profit on sale of machinery		(16,000)
C. operating profit before working capital changes		4,59,000
D. charges in current assets & current liabilities:
Increase in current assets	(60,000)
Increase in current liability	1,10,000	50,000
E. net cashflow from operating activities before tax		5,09,000
F. less tax paid		(30,000)
Net cash inflow from operating activities before tax		4,79,000
I . cashflow from investing activities
Sale of machinery		96,000
Purchase of fixed assets		(2,92,000)
Net cash used in investing activities		(1,96,000)

Working notes:

Calculation of net profit before taX
Closing balance of P & L A/c	4,00,000
Less: operating balance of P & L A/c	(1,00,000)
Add: tax	30,000
Net profit before tax	3,03,000

Working notes: (2)

Provision for depreciation account

Particulars	₹	Particulars	₹
To assets disposal A/c (B. fig)	1,30,000	By balance b/d	4,25,000
To balance c/d	4,40,000	By P & L A/c (dep.)	1,45,000
	5,70,000		5,70,000

Working note: (3)

Fixed assets account

Particulars	₹	Particulars	₹
To balance b/d	8,50,000	By assets disposal A/c	2,10,000
To bank A/c (purchase)	2,92,000	By balance c/d	9,32,000
	11,42,000		11,42,000

Working note: (4)

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Asset’s Disposal Account

Particulars	₹	Particulars	₹
To fixed assets A/c	2,10,000	By provision for depreciation A/c	1,30,000
To P & L A/c (profit)	16,000	By bank A/c (B. fig) (80,000 +16,000)	96,000
	2,26,000		2,26,000