can u solve the 36thquestion in ts grewal book 2 in the chapter cash flow the exercise given behind the lesson.Im not getting the answer.Pl help.
Cash Flow Statement for the year ended March 31, 2013 | |||
| Particulars | Amount (Rs) | Amount (Rs) |
A | Cash Flow from Operating Activities |
|
|
| Profit as per Statement of Profit and Loss (1,40,000 – 1,20,000) | 20,000 |
|
| Transfer to General Reserve | 1,00,000 |
|
| Profit Before Taxation | 1,20,000 |
|
| Items to be Added: |
|
|
| Underwriting Commission Written-off | 10,000 |
|
| Goodwill Written-off | 40,000 |
|
| Loss on Sale of Investment | 4,000 |
|
| Interest on Debentures | 30,000 |
|
| Depreciation | 80,000 |
|
| Interest received on Investments | (6,000) |
|
| Operating Profit before Working Capital Adjustments | 2,78,000 |
|
| Less: Increase in Current Assets |
|
|
| Trade Receivables | (2,20,000) |
|
| Inventories | (30,000) |
|
| Add: Increase in Current Liabilities |
|
|
| Trade Payables | 80,000 |
|
| Cash Generated from Operations | 1,08,000 |
|
| Less: Tax Paid | – |
|
| Net Cash Flow from Operating Activities |
| 1,08,000 |
|
|
|
|
B | Cash Flow from Investing Activities |
|
|
| Sale of Investments | 56,000 |
|
| Purchase of Machinery | (2,60,000) |
|
| Purchase of Investments | (1,60,000) |
|
| Interest on Investments | 6,000 |
|
| Net Cash Used in Investing Activities |
| (3,58,000) |
|
|
|
|
C | Cash Flow from Financing Activities |
|
|
| Proceeds from Issue of Share Capital | 1,00,000 |
|
| Proceeds from Issue of 10% Debentures | 2,00,000 |
|
| Interest Paid on Debentures | (30,000) |
|
| Net Cash Flow from Financing Activities |
| 2,70,000 |
|
|
|
|
D | Net Increase or Decrease in Cash and Cash Equivalents |
| 20,000 |
| Add: Cash and Cash Equivalent in the beginning of the period |
| 2,40,000 |
| Cash and Cash Equivalents at the end of the period |
| 2,60,000 |
|
|
|
|
Working Notes:
WN1
Machinery Account | |||
Dr. | Cr. | ||
Particulars | Amount (Rs) | Particulars | Amount (Rs) |
Balance b/d | 6,40,000 | Depreciation A/c | 80,000 |
Bank A/c (Purchase- Bal. Fig.) | 2,60,000 | Balance c/d | 8,20,000 |
| 9,00,000 |
| 9,00,000 |
|
|
|
|
WN2
10% Investments Account | |||
Dr. | Cr. | ||
Particulars | Amount (Rs) | Particulars | Amount (Rs) |
Balance b/d | 60,000 | Bank A/c (Sale) | 56,000 |
Bank A/c (Purchase- Bal. Fig.) | 1,60,000 | Profit and Loss A/c (Loss on Sale) | 4,000 |
|
| Balance c/d | 1,60,000 |
| 2,20,000 |
| 2,20,000 |
|
|
|
|
Notes:
1. Assumption has been made that the new investments were purchased at the end of the accounting year.
2. Assumption has been made that the new debentures were issued at the end of the accounting year.