Q 8. ​If credit sales are Rs 12,00,000 and cash sales are 20% of Total Sales find out cash flows from cash sales from operating activities. 

Q 9. If credit purchases are Rs 20,00,000 and cash purchases are 25% of total purchases. Find out the Cash Flow from operating activities.

Dear Student


Q.8
Let Total Sales = x .
Therefore cash Sales = 0.2x.
Now we know that cash sales + credit sales = Total Sales
Therefore, 12,00,000 + 0.2x = x
12,00,000 = 0.8x
x = 15,00,000/-
Therefore cash sales = 0.2x = 15,00,000 x 0.2 = 3,00,000/-
Cash flow from operating activities  = 3,00,000/-


Q.9
Let Total Purchases = x .
Therefore cash Purchases  = 0.25x.
Now we know that cash Purchase + credit Purchase = Total Purchase
Therefore, 20,00,000 + 0.25x = x
20,00,000 = 0.75x
x = 26,66,667,-
Therefore cash Purchase = 0.25x = 26,66,667 x 0.25 = 6,66,667
Cash flow from operating activities  = (6,66,667)

Regards