Question 63 Chapter 15 of Class 12 Part – 2 – 2024
63. (CFS of a Sole Trader) The Balance Sheets of X and Y on 31st March were as follows :
| Balance Sheets |
| Liabilities |
2017 ₹ |
2018 ₹ |
Assets |
2017 ₹ |
2018 ₹ |
| Creditors |
2,00,000 |
2,20,000 |
Building |
1,75,000 |
3,00,000 |
| Mrs. X’s Loan |
1,25,000 |
– |
Land |
2,00,000 |
2,50,000 |
| Bank Loan |
2,00,000 |
2,50,000 |
Machinery |
4,00,000 |
2,75,000 |
| Capital |
6,25,000 |
7,65,000 |
Stock |
1,75,000 |
1,25,000 |
|
|
|
Debtors |
1,50,000 |
2,50,000 |
|
|
|
Cash |
50,000 |
35,000 |
|
11,50,000 |
12,35,000 |
|
11,50,000 |
12,35,000 |
During the year a machine costing ₹ 50,000 (accumulated depreciation ₹ 15,000) was sold for ₹ 25,000. The provision for depreciation against machinery as on 31st March 2017 and 31st March 2018 was ₹ 1,25,000 and ₹ 2,00,00 respectively.
Net Profit for the year amounted to ₹ 2,25,000. You are required to prepare cash flow statement.
The solution of Question 63 Chapter 15 of Class 12 Part – 2 – 2024: –
Cash Flow Statement for the year ended 31st March 2018
|
Particulars
|
Rs
|
| (A) Cash Flow from Operating Activities |
|
|
| Net Profit before Tax and Extraordinary Items* |
|
2,25,000 |
| Adjustment of non-Cash & Non-Operating Items |
|
|
| Add: Depreciation |
90,000 |
|
| Loss on sale of machinery |
10,000 |
1,00,000 |
| Cash operating Profit before Working Capital adj. |
|
3,25,000 |
| Add: Decrease in current Assets: |
|
|
| Stock |
50,000 |
|
| Add: Increase in current Liabilities: |
|
|
| Creditors |
20,000 |
|
| Less : Increase in current Assets: |
|
|
| Debtors |
1,00,000 |
30,000 |
| Cash flow from Operating Activities |
|
2,95,000
|
| (B) Cash flows from Investing Activities |
|
|
| Inflow of Cash |
|
|
| Sale of Machinery |
25,000 |
|
| Outflow of Cash |
|
|
| Purchase of Land |
50,000 |
|
| Purchase of Building |
1,25,000 |
1,50,000 |
| Net cash used in investing Activities |
|
1,50,000
|
| (C) Cash flows from Financing Activities |
|
|
| Inflow of Cash |
|
|
| Loan from Bank |
50,000 |
|
| Outflow of Cash |
|
|
| Repayment of Mrs. X’s Loan |
1,25,000 |
|
| Drawings |
25,000 |
1,50,000 |
| Net cash used in financing activities |
|
1,50,000
|
| Net Increase in Cash & Cash Equivalents (A + B + C) |
|
15,000 |
| Add: Cash & Cash equivalents in the beginning |
|
50,000 |
| Cash & Cash equivalents at the end |
|
35,000 |
Plant Account
|
Particulars
|
Amount ₹
|
Particulars
|
Amount ₹
|
| To Balance b/d |
5,25,000 |
By Depreciation |
15,000 |
|
|
By Cash A/c – Sale |
25,000 |
|
|
By Profit & Loss A/c – Loss |
10,000 |
|
|
By Balance c/d |
4,75,000 |
|
5,25,000 |
|
5,25,000 |
Provision for Depreciation Account
|
Particulars
|
Amount ₹
|
Particulars
|
Amount ₹
|
| To Machinery A/c |
15,000 |
By Balance b/d |
1,25,000 |
| To Balance c/d |
2,00,000 |
|
|
|
|
By Profit & Loss A/c – (Bal. fig.) |
90,000 |
|
2,15,000 |
|
2,15,000 |
Provision for Taxation Account
|
Particulars
|
Amount ₹
|
Particulars
|
Amount ₹
|
| To Bank – Payment |
35,000 |
By Balance b/d |
40,000 |
| To Balance c/d |
50,000 |
|
|
|
|
By Profit & Loss |
45,000 |
|
85,000 |
|
85,000 |
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