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Question 48 Chapter 8 – Unimax Publication Class 12 Part 2 – 2021
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48. From the following particulars of Mr. Ram (a Proprietor), prepare a cash Flow Statement as per AS-3, (Revised).
BALANCE SHEETS
| Liabilities | 31.3.2021 | 31.3.2022 | Assets | 31.3.2022 | 31.3.2022 |
| Creditors | 30,000 | 42,000 | Cash at Bank | 4,000 | 5,000 |
| Mr. X’s Loan | 5,000 | 20,000 | Debtors | 35,000 | 40,000 |
| Bank Loan | 20,000 | 10,000 | Stock | 20,000 | 25,000 |
| Capital | 1,50,000 | 1,60,000 | Land | 25,000 | 36,000 |
| Depreciation Provision | 10,000 | 15,000 | Building | 50,000 | 55,000 |
| Machinery | 81,000 | 86,000 | |||
| 2,15,000 | 2,47,000 | 2,15,000 | 2,47,000 |
Additional Information:
During the year 2021 Mr. Ram had drawn 21,000 for domestic use and a part of the machine costing 10,000 (accumulated depreciation thereon 8,000) was sold for 5,000.
The solution of Question 48 Chapter 8 – Unimax Publication Class 12 Part 2-2021 : –
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CASH FLOW STATEMENT (INDIRECT METHOD)
FOR THE YEAR ENDED 31.3.2022(AS-3(REVISED)
| Particulars | ₹ | ₹ | |
| (A)cash flow from operating activities | |||
| Net Profit before tax and extraordinary items | 31,000 | ||
| Adjustment for: | |||
| Depreciation on Machine | 13,000 | ||
| Gain on Sale of Machine | (3,000) | ||
| Operating profit before working Capital changes | 41,000 | ||
| Add: Increase in Current Liabilities: | |||
| Creditors | 12,000 | ||
| 53,000 | |||
| Less: Increase in Current Assets: | |||
| Debtors | ₹ 5,000 | ||
| Stock | ₹ 5,000 | (10,000) | |
| Net Cash from Operating Activities | 43,000 | 43,000 | |
| B. Cash Flow from investing Activities | |||
| Purchase of Land | (11,000) | ||
| Purchase of Machinery | (15,000) | ||
| Purchase of Building | (5,000) | ||
| Sale of Machine | 5,000 | ||
| Net Cash used in investing Activities | (26,000) | (26,000) | |
| C. Cash Flow from Financing Activities: | |||
| Funds from Raising Loan from Mr. X | 15,000 | ||
| Repayment of Bank Loan | (10,000) | ||
| Drawings of X | (21,000) | ||
| Net Cash used in Financing Activities | (16,000) | (16,000) | |
| Net Increase in cash and cash equivalents | 1,000 | ||
| Cash and cash equivalents at the beginning of the period | 4,000 | ||
| Cash and cash equivalents at the End of the period | 5,000 | ||
Working Notes:
CAPITAL ACCCOUNT
| Particulars | ₹ | Particulars | ₹ |
| To Bank A/c | 21,000 | By Balance c/d | 1,50,000 |
| To Balance C/d | 1,60,000 | By Profit and Loss, A/c | 31,000 |
| 1,81,000 | 1,81,000 | ||
| By Balance b/d | 1,60,000 |
MACHINERY ACCCOUNT
| Particulars | ₹ | Particulars | ₹ |
| To Balance b/d | 81,000 | By Provision for Depreciation A/c | 8,000 |
| To Gain on Sale of Machinery | 3,000 | By Bank A/c (Sale) | 5,000 |
| To Bank A/c (b/f) (Purchase) | 15,000 | By Balance c/d | 86,000 |
| 99,000 | 99,000 |
PROVISION FOR DEPRECIATION ACCCOUNT
| Particulars | ₹ | Particulars | ₹ |
| To Machinery A/c | 8,000 | By Depreciation b/d | 10,000 |
| Bank Balance c/d | 15,000 | By Depreciation A/c | 13,000 |
| (Depreciation during the year) | |||
| 23,000 | 23,000 | ||
| By Balance b/d | 15,000 |
Alternatively, Machinery Account and Machinery Sold Account can be Clubbed Together.
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MACHINERY ACCCOUNT
| Particulars | ₹ | Particulars | ₹ |
| To Balance b/d | 81,000 | By Machinery Sold A/c | 10,000 |
| To Bank A/c (Purchase) | 15,000 | By Balance c/d | 86,000 |
| 96,000 | 96,000 | ||
| To Balance b/d | 86,000 |
PROVISION FOR DEPRECIATION ACCCOUNT
| Particulars | ₹ | Particulars | ₹ |
| To Machinery A/c | 8,000 | By Balance b/d | 10,000 |
| Bank Balance c/d | 15,000 | By Depreciation A/c | 13,000 |
| (Depreciation during the year) | |||
| 23,000 | 23,000 | ||
| By Balance b/d | 15,000 |
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MACHINERY ACCCOUNT
| Particulars | ₹ | Particulars | ₹ |
| To Machinery A/c | 10,000 | By Provision for Depreciation A/c | 8,000 |
| To Gain on Sale of Machinery | 3,000 | By Bank A/c | 5,000 |
| 13,000 | 13,000 |
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What is the cash flow statement? why do we need to prepare?
Unimax Publication – Accountancy PSEB Class 12 – Volume I – Solution
- Chapter No. 1 – Accounting Not for Profit Organisations
- Chapter No. 2 – Partnership Accounts – I (Introduction)
- Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation)
- Chapter No. 4 – Partnership Accounts – III (Change in Profit sharing ratio among Existing Partners )
- Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)
- Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)
- Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)
Unimax Publication – Accountancy PSEB (Class 12) – Part – II – Solution
- Chapter No. 1 – Company Accounts (Share Capital)
- Chapter No. 2 – Company Accounts (Issue of Debentures)
- Chapter No. 3 – Company Accounts (Redemption of Debentures)
- Chapter No. 4 – Financial Statements of a Company
- Chapter No. 5 – Financial Statement Analysis
- Chapter No. 6 – Tools of Financial Statement Analysis- Comparative and Common Size
- Chapter No. 7 – Ratio Analysis
- Chapter No. 8 – Cash Flow Statement
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