Why isn't dividend paid on prefrence share calculated(10per. Prefrence share capital.) In the solution of this ques.it is the last ques of ts grewal

Why isn't dividend paid on prefrence share calculated(10per. Prefrence share capital.) In the solution of this ques.it is the last ques of ts grewal machinery 60000 which depr«iation Charged Was S, o' mk Assets tar 4 S at par on 1st 2016 and Bank Loan was repaid on the Shares redeemed at a of Ans„• Ne' Cosh now from Operonhg Act'vities = 3,7SOCO: Net InvestingAcfrviries= t Cash How from Financing Activities 86.0* Increase in Cash ond Cash Equivalents

Hi Nandu,

Ideally the dividend on the opening balance of Preference Share Capital should have been accounted for while preparing the Cash Flow Statement.

However, the answer as per the textbook does not consider the impact of this adjustment. Hence, the solution on the website has been aligned with the answers given in the book.

If you get such a question in the examination, it is suggested that you should consider the impact of dividend while preparing the Cash Flow Statement.

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