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Question 55 Chapter 5 of +2-B – USHA Publication 12 Class

Question 55 Chapter 5 of +2-B
Q-55- CH-5 Book 2 - Usha Publisher +2 Book 2019 - Solution

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Question 55 Chapter 5 of +2-B

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55. (CFS Showing Operating, Investing & Financing Activities) From the following balance sheet of Sewak Ltd. as on 31st March, 2017 and 2018. Prepare cash flow statement.

Particulars Note No. 31st March 2017 31st March 2018
I. Equity and Liabilities      
 Shareholders Fund :       
(a) Share Capital   4,00,000 7,00,000
(b) Reserves and Surplus (Balance in statement of profit and loss)    50,000 3,20,000
2. Non-current Liabilities       
Long-term Borrowings (9% debentures)    2,00,000 4,00,000
3. Current Liabilities       
(a) Trade Payables (Creditors)    1,10,000 1,50,000
(b) Other Current Liabilities (Expenses)   10,000 20,000
Total    6,70,000 9,50,000
II. Assets       
1. Non-Current Assets :       
(a) Fixed Assets    3,00,000 5,00,000
(b) Non —current Investments   2,00,000 1,40,000
2. Current Assets       
(a) Inventories (Stock)   50,000 1,00,000
(b) Trade Receivables (Debtors)   1,00,000 1,70,000
(c) Cash and Cash Equivalents   20,000 40,000
Total    6,70,000 9,50,000

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Additional Information
Included in fixed assets was a piece of machinery costing 70,000 on which depreciation charged was 40,000 and it was sold for Z 30,000. During the year, 1,40,000 depreciation was charged on fixed assets. Prepare the cash flow statement.

The solution of Question 55 Chapter 5 of +2-B: – 

Cash Flow Statement for the year ended 31st March 2016
Particulars
Rs
(A) Cash Flow from Operating Activities    
Net Loss as per the statement of Profit and Loss A/c   2,70,000
Adjustment of Non-cash & Non-Operating items    
Add: Depreciation on Fixed Assets 1,40,000  
Interest on Debentures 6% on ₹ 2,00,000 18,000 1,58,000
Operating Loss before change in Working Capital   1,12,000
Add: Increase in Current Liabilities:    
Creditors 40,000  
Outstanding Expenses 10,000 50,000
Less: Increase in current Assets:    
Inventories 50,000  
Debtors 70,000 1,20,000
Cash used in Operating Activities   1,82,000
(B) Cash flows from Investing Activities    
Inflow of Cash    
Sale of Fixed Assets 30,000  
Sale of Investment 60,000  
Outflow of Cash    
Purchase of Fixed Assets    
Cash used in Investing Activities 3,70,000  
Net cash used in investing Activities   2,80,000
(C) Cash flows from Financing Activities    
Inflow of Cash    
Issue of Equity Shares 3,00,000  
Issue of 9% Debentures 2,00,000  
Outflow of Cash    
Interest paid on Debentures 18,000 4,82,000
Net cash flow from financing activities   4,82,000
Net decrease in cash & Cash equivalents (A + B + C)   20,000
Add: Cash equivalent at the beginning of the year   20,000
Cash equivalent at the end of year   40,000

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Working Note

Fixed Assets Account
Particulars
Amount ₹
Particulars
Amount ₹
To Balance b/d 3,00,000 By Depreciation
1,40,000
    By Bank A/c –Sale 30,000
To Bank –Purchase (Bal. fig.) 3,70,000 By Balance c/d 5,00,000
  6,70,000   6,70,000

 

Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

Question 1 Chapter 1 of +2-B
T.S. Grewal’s Analysis of Financial Statement

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