Question 54 Chapter 5 of +2-B
Table of Contents
54. From the following Balance Sheet of SRS Ltd. and the additional information as on 31st March, 2016, prepare a Cash Flow Statement:
| SRS Ltd. | |||
| Particulars | Note No. | 31st March, 2016 Rs | 31st March, 2015 Rs |
| I. EQUITY AND LIABILITIES | |||
| 1. Shareholders’ Funds | |||
| (a) Share Capital | 4,50,000 | 3,50,000 | |
| (b) Reserves and Surplus | 1 | 1,25,000 | 50,000 |
| 2. Non-Current Liabilities | |||
| Long-term Borrowings | 2 | 2,25,000 | 1,75,000 |
| 2. Current Liabilities | |||
| (a) Short-term Borrowings | 3 | 75,000 | 37,500 |
| (b) Short -term Provisions | 4 | 1,00,000 | 62,500 |
| Total | 9,75,000 | 6,75,000 | |
| II. ASSETS | |||
| 1. Non-Current Assets | |||
| Fixed Assets : | |||
| (i) Tangible Assets | 5 | 7,32,500 | 4,52,500 |
| (ii) Intangible Assets: Goodwill | 6 | 50,000 | 75,000 |
| (b) Non-current Investments | 75,000 | 50,000 | |
| 2. Current Assets | |||
| (a) Current Investments | 20,000 | 35,000 | |
| (b) Inventories | 7 | 61,000 | 36,000 |
| (c) Cash and Cash Equivalents | 36,500 | 26,500 | |
| Total | 9,75,000 | 6,75,000 | |
Notes to Accounts
| Particulars | 31st March, 2016 ( Rs) | 31st March, 2015 ( Rs) |
| 1. Reserves and Surplus | ||
| Surplus, i.e., Balance in Statement of Profit and Loss | 1,25,000 | 50,000 |
| 1,25,000 | 50,000 | |
| 2. Short-term Borrowings : | ||
| Cash and Cash Equivalents | 2,25,000 | 1,75,000 |
| 2,25,000 | 1,75,000 | |
| 3. Short-term Borrowings | ||
| Bank Overdraft | 75,000 | 37,500 |
| 75,000 | 37,500 | |
| 4. Short-term Provisions | ||
| Provision for Tax | 1,00,000 | 62,500 |
| 1,00,000 | 62,500 | |
| 5. Tangible Assets | ||
| Machinery | 8,37,500 | 5,22,500 |
| Accumulated Depreciation | (1,05,000) | -70,000 |
| 7,32,500 | 4,52,500 | |
| 6. Intangible Assets | ||
| Goodwill | 50,000 | 75,000 |
| 50,000 | 75,000 | |
| 7. Inventories | ||
| Stock-in-Trade | 61,000 | 36,000 |
| 61,000 | 36,000 |
Additional Information:
i Rs 50,000, 12% Debentures were issued on 31st March, 2016.
ii During the year, a piece of machinery costing Rs 40,000, on which accumulated depreciation was Rs 20,000, was sold at a loss of Rs 5,000.
The solution of Question 54 Chapter 4 of +2-B: –
Cash Flow Statement for the year ended 31st March,2019 |
||
| Particulars |
Rs |
|
| I. Cash Flow from Financing Activities | ||
| Profit as per Statement of Profit and Loss : | ||
| Closing Balance of Profit & Loss | 1,25,000 | |
| Less: Opening Balance of Profit & Loss | 50,000 | |
| Provision for Tax | 1,00,000 | 1,75,000 |
| Net Profit before tax and extraordinary items | 1,75,000 | |
| Items to be Added: | ||
| Goodwill written off | 25,000 | |
| Debentures Interest | 21,000 | |
| Depreciation (WN 2) | 55,000 | |
| Loss on Sale of Machinery | 5,000 | 1,06,000 |
| Operating Profit before Working Capital Adjustments | 2,81,000 | |
| Less: Increase in Current Assets | ||
| Inventories | 25,000 | |
| Cash Generated from Operations | 2,56,000 | |
| Less: Tax Paid (WN 3) | 62,500 | |
| Net Cash Flow from Operating Activities | 1,93,500 | |
| II. Cash Flow from Financing Activities | ||
| Sale of machinery | 15,000 | |
| Purchase of machinery (WN 1) | 3,55,000 | |
| Purchase of non-current investment | 25,000 | 3,65,000 |
| Net Cash Used in Investing Activities | 3,65,000 | |
| III: Cash Flow from Financing Activities | ||
| Proceeds from Issue of Equity Shares | 1,00,000 | |
| Increase in Bank Overdraft | 37,500 | |
| Interest on Debentures paid | 21,000 | |
| Proceeds from Issue of Debentures | 50,000 | 1,66,500 |
| Net Cash Flow from Financing Activities | 1,66,500 | |
| IV. Net Decrease in Cash and Cash Equivalents |
(5,000) | |
| Add: Cash and Cash Equivalents in the beginning of the period |
61,500 |
|
| Cash and Cash Equivalents at the end of the period |
56,500 | |
| Machinery Account | |||
| Particulars |
Rs | Particular | Rs |
| To Balance b/d | 5,22,500 | By Depreciation A/c | 20,000 |
| To Bank A/c (Purchases – Bal. Fig.) | 3,55,000 | By Bank (Sales) | 15,000 |
| By Loss on Sale (Profit and Loss A/c) | 5,000 | ||
| By Balance c/d | 8,37,500 | ||
| 8,77,500 | 8,77,500 | ||
| Accumulated Depreciation Account | |||
| Particulars |
Rs | Particular | Rs |
| To Machinery A/c | 20,000 | By Balance b/d | 70,000 |
| By Profit and Loss A/c (Dep. charged during the year- Bal. Fig.) | 55,000 | ||
| To Balance c/d | 1,05,000 | ||
| 1,25,000 | 1,25,000 | ||
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Also, Check out the solved question of previous Chapters: –
T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)
- Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
- Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
- Chapter No. 3 – Goodwill: Nature and Valuation
- Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
- Chapter No. 5 – Admission of a Partner
- Chapter No. 6 – Retirement/Death of a Partner
- Chapter No. 7 – Dissolution of a Partnership Firm
T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)
- Chapter No. 8 – Company Accounts – Accounting for Share Capital
- Chapter No. 9 – Company Accounts – Issue of Debentures
- Chapter No. 10 – Redemption of Debentures
T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)
- Chapter No. 1 – Financial Statements of a Company
- Chapter No. 2 – Financial Statement Analysis
- Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
- Chapter No. 4 – Accounting Ratios
- Chapter No. 5 – Cash Flow Statement
Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication
