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Page No 3.100:

Answer:

Cash Flow from Operating Activities
For the Year Ending March 31, 2015
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   1,25,000
+ Provision for Tax   20,000
+ Reserve  
+ Dividend   15,000
  Add: Non Operating Expenses    
Goodwill Written Off 10,000  
Preliminary Expenses Written Off 2,000  
Loss on Sale of Machinery 10,000 22,000
  Less: Non Operating Incomes    
Profit on Sale of Furniture (5,000) (5,000)
Operating Profit Before Working Capital Changes   1,77,000
  Add: Decrease in Current Assets & Increase in Current Liabilities    
Inventories 6,000  
Expenses Outstanding 1,000 7,000
  Less: Increase in Current Assets & Decrease in Current Liabilities    
Creditors (8,000)  
Debtors (4,000)  
Provision for Tax (2,000) (12,000)
     
Cash From Operating  Activities   1,70,000
Less: Tax Paid  
Net Cash From Operating  Activities (A)   1,70,000
     



Page No 3.101:

Answer:

Cash From Investing  Activities
For the Year Ending …..
Particulars Details
(Rs)
Amount
(Rs)
Cash From Investing  Activities    
Purchase of Land (5,00,000)  
Purchase of Investment (2,70,000)  
Purchase of Machinery (4,50,000)  
Proceeds from Sale of Building 6,00,000  
Proceeds from Sale of Investments 1,60,000  
Proceeds from Sale of Machinery 2,10,000  
Interest received 20,000  
Dividend Received 30,000  
Rent Received 90,000 (1,10,000)
     
Net Cash From Investing Activities   (1,10,000)
     

Page No 3.101:

Answer:

Cash From Investing  Activities
For the Year Ending March31,2014
Particulars Details
(Rs)
Amount
(Rs)
Cash From Investing  Activities    
     
Purchase of Plant & Machinery (2,60,000)  
Proceeds from Sale of Plant & Machinery 40,000  
Proceeds from Sale of Land 1,60,000  
Purchase of Investment (60,000) (1,20,000)
     
Net Cash From Investing Activities    (1,20,000)
     

Working Notes:-

Plant & Machinery Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 8,50,000 Depreciation A/c 50,000
Bank A/c (Purchases)
(Balancing Figure)
2,60,000 Sales A/c 40,000
    P& L A/c ( Loss) 20,000
    Balance c/d 10,00,000
       
  11,10,000   11,10,000
       

Land Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 2,00,000 Sales A/c (Balancing Figure) 1,60,000
P& L A/c (Profit) 60,000 Balance c/d 1,00,000
       
  2,60,000   2,60,000
       

Page No 3.101:

Answer:

Cash From Investing  Activities
For the Year Ending March31,2014
Particulars Details
(Rs)
Amount
(Rs)
Cash From Investing  Activities    
Purchase of Goodwill (1,00,000)  
Purchase of Investment (1,80,000)  
Purchase of Machinery (4,40,000)  
Proceeds from Sale of Patents 1,00,000  
Proceeds from Sale of Investments 1,00,000  
Proceeds from Sale of Machinery 50,000  
Interest on Investment received 7,200  
Dividend Received on Investment 10,000  
Rent Received 20,000  
     
Net Cash From Investing Activities   4,32,800
     

Working Notes:-  
Machinery Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 10,20,000 Depreciation A/c 1,40,000
Bank A/c ( Purchases)
(Balancing Figure)
4,40,000 Bank A/c 50,000
    P& L A/c ( Loss) 30,000
    Balance c/d 12,40,000
       
  14,60,000   14,60,000
       

Patents Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 3,80,000 P& L A/c ( Loss) 40,000
P& L A/c ( Profit) 20,000 Sales A/c (Balancing Figure) 1,00,000
    Balance c/d 2,60,000
       
  14,60,000   14,60,000
       
 
Investment  Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 60,000 Sales A/c (Balancing Figure) 1,00,000
Bank A/c 1,80,000 Balance c/d 1,60,000
P& L A/c ( Profit) 20,000    
       
       
  2,60,000   2,60,000
       

Page No 3.101:

Answer:

Cash From Financing Activities
For the Year Ending March31,2014
Particulars Details
(Rs)
Amount
(Rs)
Cash From Financing Activities    
Interest Paid on Debentures (19,000)  
Dividend Paid (50,000)  
Proceeds from Issue of Share Capital 2,00,000  
Proceeds from Issue of Debenture 1,00,000 2,31,000
     
Net Cash From Financing Activities   2,31,000
     



Page No 3.102:

Answer:

Cash Flow Statement
For the Year Ending March31,2014
Particulars Details
(Rs)
Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   9,000
+ Provision for Tax   32,000
+ General Reserve   10,000
+ Proposed Dividend   39,000
  Add: Non Operating Expenses    
Goodwill Written Off 10,000 10,000
  Less: Non Operating Incomes  
     
     
Operating Profit Before Working Capital Changes   1,00,000
  Add: Decrease in Current Assets & Increase in Current Liabilities    
Inventories 7,000  
Creditors 18,000 25,000
  Less: Increase in Current Assets & Decrease in Current Liabilities    
Debtors (33,000)  
Other Current Liabilities (2,000) (35,000)
     
Cash From Operating  Activities   90,000
  Less: Tax Paid   (28,000)
Net Cash From Operating  Activities (A)   62,000
     
Cash From Investing  Activities    
Purchase of Plant (1,01,000)  
Purchase of Investment (25,000)  
Proceeds from Sale of Land & Building 53,000 (73,000)
Net Cash From Investing Activities (B)   (73,000)
     
Cash From Financing Activities    
Proposed Dividend (28,000)  
Proceeds from Share Capital 50,000 22,000
     
Net Cash From Financing Activities (C)   22,000
Net Increase in Cash (A + B + C)   11,000
Add: Opening Cash and Cash Equivalents   17,000
(Cash + Marketable Investments- Bank Overdraft)    
Closing Cash and Cash Equivalents   28,000
(Cash + Marketable Investments- Bank Overdraft)    
     



Page No 3.103:

Answer:

Cash Flow Statement
For the Year Ending March 31, 2015
Particulars Details
(Rs)
Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   47,000
+ Provision for Tax   30,000
+ General Reserve   25,000
+ Proposed Dividend  
  Add: Non Operating Expenses    
Goodwill Written Off 18,000 18,000
  Less: Non Operating Incomes  
     
Operating Profit Before Working Capital Changes   1,20,000
  Add: Decrease in Current Assets & Increase in Current Liabilities    
Inventories 40,000  
O/standing Expenses 10,000 50,000
  Less: Increase in Current Assets & Decrease in Current Liabilities    
Debtors (34,000)  
Creditors (93,000) (1,27,000)
     
Cash From Operating  Activities   43,000
  Less: Tax Paid   (22,000)
Net Cash From Operating  Activities (A)   21,000
     
Cash From Investing  Activities    
Proceeds from Sale of Land & Building 1,50,000  
Purchase of Machinery (1,65,000)  
Proceeds from Sale of Investment 32,000 17,000
Net Cash From Investing Activities (B)   17,000
     
Cash From Financing Activities    
Payment of Land & Building (30,000)  
Proceeds from Share Capital 30,000
     
Net Cash From Financing Activities (C)  
Net Increase in Cash (A + B + C)   38,000
Add: Opening Cash and Cash Equivalents   (60,000)
(Cash + Marketable Investments- Bank Overdraft)    
Closing Cash and Cash Equivalents   (22,000)
(Cash + Marketable Investments- Bank Overdraft)    
     



Page No 3.104:

Answer:

Cash Flow Statement
For the Year Ending March31,2014
Particulars Details
(Rs)
Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   1,05,000
+ Provision for Tax   15,000
+ General Reserve  
+ Proposed Dividend   28,000
   Add: Non Operating Expenses    
Depreciation on Furniture 16,000 16,000
  Less: Non Operating Incomes  
     
Operating Profit Before Working Capital Changes   1,64,000
  Add: Decrease in Current Assets & Increase in Current Liabilities    
Debtors 9,000  
Prepaid Expenses 2,000  
Bills Receivable 15,000 26,000
  Less: Increase in Current Assets & Decrease in Current Liabilities    
Creditors (34,000)  
Inventories (22,000) (56,000)
     
Cash From Operating  Activities   1,34,000
  Less: Tax Paid   (10,000)
Net Cash From Operating  Activities (A)   1,24,000
     
Cash From Investing  Activities    
Purchase of Fixed Assets (1,55,000) (1,55,000)
Net Cash From Investing Activities (B)   (1,55,000)
     
Cash From Financing Activities    
Proceeds from Land & Building 25,000  
Proposed Dividend (20,000) 5,000
     
Net Cash From Financing Activities (C)   5,000
Net Increase in Cash (A + B + C)   (26,000)
Add: Opening Cash and Cash Equivalents   59,000
(Cash + Marketable Investments- Bank Overdraft)    
Closing Cash and Cash Equivalents   33,000
(Cash + Marketable Investments- Bank Overdraft)    
     

Working Note:-
 
Fixed Assets Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 1,84,000 Depreciation 16,000
Cash A/c (Balancing Figure) 1,55,000 Balance c/d 3,23,000
       
  3,39,000   3,39,000
       



Page No 3.105:

Answer:

Cash Flow Statement
For the Year Ending March 31, 2014
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   50,000
+ Provision for Tax   15,000
+ General Reserve  
+ Proposed Dividend   30,000
  Add: Non Operating Expenses    
Depreciation on Plant & Machinery 10,000 10,000
  Less: Non Operating Incomes  
     
Operating Profit Before Working Capital Changes   1,05,000
  Add: Decrease in Current Assets & Increase in Current Liabilities    
Creditors 44,000  
Bills Receivable 4,000 48,000
  Less: Increase in Current Assets & Decrease in Current Liabilities    
Debtors (36,000)  
Inventories (40,000) (76,000)
     
Cash From Operating  Activities   77,000
  Less: Tax Paid   (12,000)
Net Cash From Operating  Activities (A)   65,000
     
Cash From Investing  Activities    
Proceeds from sale of Plant & Machinery 50,000 50,000
Net Cash From Investing Activities (B)   50,000
     
Cash From Financing Activities    
Payment of  Land & Building (75,000)  
Proposed Dividend (20,000) (95,000)
     
Net Cash From Financing Activities (C)   (95,000)
Net Increase in Cash (A + B + C)   20,000
  Add: Opening Cash and Cash Equivalents   (32,000)
(Cash + Marketable Investments- Bank Overdraft)     
Closing Cash and Cash Equivalents   (12,000)
(Cash + Marketable Investments- Bank Overdraft)    
     

Working Note:-

Plant & Machinery Account
Dr.   Cr.
Particulars  Amount
(Rs)
Particulars Amount (Rs)
Balance b/d 1,50,000 Depreciation 10,000
    Bank A/c (Balancing Figure) 50,000
    Balance c/d 90,000
  1,50,000   1,50,000
       



Page No 3.106:

Answer:

Cash Flow Statement
For the Year Ending March31,2014
Particulars Details
(Rs)
Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   (56,000)
+ Provision for Tax    
+ General Reserve    
+ Proposed Dividend    
Add: Non Operating Expenses    
Depreciation on Plant & Machinery 10,000  
Loss on Sale of Furniture 2,000  
Debenture Interest 12,000 24,000
  Less: Non Operating Incomes  
     
     
Operating Profit Before Working Capital Changes   (32,000)
  Add: Decrease in Current Assets & Increase in Current Liabilities  
     
  Less: Increase in Current Assets & Decrease in Current Liabilities    
Debtors (10,000)  
Creditors (25,000) (35,000)
     
Cash From Operating  Activities   (67,000)
  Less: Tax Paid  
Net Cash From Operating  Activities (A)   (67,000)
     
Cash From Investing  Activities    
Proceeds from sale of Fixed Assets 28,000  
Purchase of Fixed Assets (1,20,000) (92,000)
Net Cash From Investing Activities (B)   (92,000)
     
Cash From Financing Activities    
Proceeds from Issue of Share Capital 1,00,000  
Proceeds from issue of 12% Debentures 36,000  
Debenture Interest Paid (12,000)  
Security Premium Reserve 25,000 1,49,000
     
Net Cash From Financing Activities (C)   1,49,000
Net Increase in Cash (A + B + C)   (10,000)
  Add: Opening Cash and Cash Equivalents   40,000
(Cash + Marketable Investments- Bank Overdraft)    
Closing Cash and Cash Equivalents   30,000
(Cash + Marketable Investments- Bank Overdraft)    
     

Working Note:-
 
Fixed Assets Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 2,00,000 Depreciation (Balancing Figure) 10,000
Cash A/c 1,20,000  Cash A/c 28,000
    P& L A/c 2,000
  3,20,000   3,20,000
       



Page No 3.107:

Answer:

Cash Flow Statement
For the Year Ending March31,2014
Particulars Details
(Rs)
Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   36,000
+ Provision for Tax   27,000
+ General Reserve   30,000
+ Proposed Dividend    
  Add: Non Operating Expenses    
Depreciation on Fixed Assets 2,10,000  
Interim Dividend 1,20,000 3,30,000
  Less: Non Operating Incomes    
Profit on Sale of Investment (1,500)  
Profit on Sale of Fixed Assets (6,000) (7,500)
     
Operating Profit Before Working Capital Changes   4,15,500
  Add: Decrease in Current Assets & Increase in Current Liabilities    
Inventories 90,000 90,000
     
  Less: Increase in Current Assets & Decrease in Current Liabilities    
Debtors (7,35,000)  
Creditors (1,02,000) (8,37,000)
     
Cash From Operating  Activities   3,31,500
  Less: Tax Paid   (2,22,000)
Net Cash From Operating  Activities (A)   (5,53,500)
     
Cash From Investing  Activities    
Proceeds from sale of Investment 25,500  
Proceeds from sale of Fixed Assets 36,000  
Purchase of  Investment (54,000) 7,500
Net Cash From Investing Activities (B)   7,500
     
Cash From Financing Activities    
Interim Dividend (1,20,000)  
Proceeds from Land & Buildings 8,10,000 6,90,000
     
     
Net Cash From Financing Activities (C)   6,90,000
Net Increase in Cash (A + B + C)   1,44,000
Add: Opening Cash and Cash Equivalents   4,47,000
(Cash + Marketable Investments- Bank Overdraft)    
Closing Cash and Cash Equivalents   5,91,000
(Cash + Marketable Investments- Bank Overdraft)    
     

Working Note:-
 
Investment  Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 1,50,000 Bank A/c 25,500
P & L A/c 1,500 Balance c/d 1,80,000
Bank A/c (Balancing Figure) 54,000    
  2,05,500   2,05,500
       
 
Provision for Tax Account
Dr.   Cr.
Particulars  Amount
(Rs)
Particulars Amount
(Rs)
Cash A/c 2,22,000 Balance b/d 2,25,000
Balance c/d 30,000 P & L A/c 27,000
       
  2,52,000   2,52,000
       
 
Fixed Assets Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 12,00,000 Depreciation (Balancing Figure) 2,10,000
P & L A/c 6,000 Bank A/c 36,000
    Balance c/d 9,60,000
  12,06,000   12,06,000
       



Page No 3.108:

Answer:

Cash Flow Statement
For the Year Ending March 31, 2013
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   100
+ Provision for Tax   33,000
+ General Reserve   10,000
+ Proposed Dividend  
  Add: Non Operating Expenses    
Depreciation on Machinery 14,000  
Depreciation on Building 10,000  
Dividend 23,000 47,000
  Less: Non Operating Incomes  
Profit on Sale of Investment    
Profit on Sale of Fixed Assets    
     
Operating Profit Before Working Capital Changes   47,000
  Add: Decrease in Current Assets & Increase in Current Liabilities    
Inventories 26,000  
Debtors 16,000 42,000
  Less: Increase in Current Assets & Decrease in Current Liabilities    
Creditors (15,000) (15,000)
     
Cash From Operating  Activities   1,17,100
  Less: Tax Paid   (28,000)
Net Cash From Operating  Activities (A)   89,100
     
Cash From Investing  Activities    
Purchase of  Machinery (33,000)  
Purchase of Goodwill (5,000) (38,000)
     
Net Cash From Investing Activities (B)   (38,000)
     
Cash From Financing Activities    
Dividend Paid (23,000)  
Proceeds from Share Capital 50,000  
Redemption of  Land & Buildings (70,000) (43,000)
     
Net Cash From Financing Activities (C)   (43,000)
Net Increase in Cash (A + B + C)   8,100
  Add: Opening Cash and Cash Equivalents   500
(Cash + Marketable Investments- Bank Overdraft)    
Closing Cash and Cash Equivalents (600+8,000)   8,600
(Cash + Marketable Investments- Bank Overdraft)    
     

Working Note:-
 
Machinery  Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount (Rs)
Balance b/d 1,50,000 Depreciation A/c 14,000
Cash A/c 33,000 Balance c/d 1,69,000
       
  1,83,000   1,83,000
       
 
 
Provision for Tax Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Cash A/c 28,000 Balance b/d (Balancing Figure) 30,000
Balance c/d 35,000 P & L A/c 33,000
       
  63,000   63,000
       
 
Building Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 2,00,000 Depreciation 10,000
    Balance c/d 1,90,000
       
  2,00,000   2,00,000
       



Page No 3.109:

Answer:

Cash Flow Statement
For the Year Ending March 31, 2015
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   1,000
+ Provision for Tax   19,000
+ General Reserve    
+ Proposed Dividend    
  Add: Non Operating Expenses    
Depreciation on Plant 4,000  
Depreciation on Building 4,000 8,000
  Less: Non Operating Incomes    
Interest on  Investment (1,000) (1,000)
     
Operating Profit Before Working Capital Changes   27,000
  Add: Decrease in Current Assets & Increase in Current Liabilities    
Inventories 6,600 6,600
  Less: Increase in Current Assets & Decrease in Current Liabilities    
Creditors (2,600)  
Bills Payable (400)  
Debtors (2,000) (5,000)
     
Cash From Operating  Activities   28,600
  Less: Tax Paid   (17,000)
Net Cash From Operating  Activities (A)   11,600
     
Cash From Investing  Activities    
Purchase of  Plant (3,000)  
Interest Received on Investment 1,000  
Purchase of Investment 1,000 (3,000)
     
Net Cash From Investing Activities (B)   (3,000)
     
Cash From Financing Activities  
     
Net Cash From Financing Activities (C)  
Net Increase in Cash (A + B + C)   8,600
  Add: Opening Cash and Cash Equivalents (2,600+4,000)   6,600
(Cash + Marketable Investments- Bank Overdraft)    
Closing Cash and Cash Equivalents (5,200+10,000)   15,200
(Cash + Marketable Investments- Bank Overdraft)    
     

Working Note:-
Plant  Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount (Rs)
Balance b/d 37,000 Depreciation A/c 4,000
Cash A/c (Balancing Figure) 3,000 Balance c/d 36,000
       
  40,000   40,000
       
 
Provision for Tax Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Cash A/c (Balancing Figure) 17,000 Balance b/d 16,000
Balance c/d 18,000 P & L A/c 19,000
       
  35,000   35,000
       



Page No 3.110:

Answer:

Cash Flow Statement
For the Year Ending March31,2015
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   40,000
+ Provision for Tax   80,000
+ General Reserve   40,000
+ Proposed Dividend   22,500
  Add: Non Operating Expenses    
Depreciation on Fixed Assets 10,000  
Interest Paid on Loan 5,000  
Interest Paid on Debentures 9,000 24,000
  Less: Non Operating Incomes  
     
Operating Profit Before Working Capital Changes   2,06,500
  Add: Decrease in Current Assets & Increase in Current Liabilities    
Creditors 10,000 10,000
  Less: Increase in Current Assets & Decrease in Current Liabilities    
Inventories (25,000)  
Debtors (50,000)  
Current Investments (1,500) (76,500)
     
Cash From Operating  Activities   1,40,000
  Less: Tax Paid   (60,000)
Net Cash From Operating  Activities (A)   80,000
     
Cash From Investing  Activities  
     
Net Cash From Investing Activities (B)  
     
Cash From Financing Activities    
Interest Paid on Loan from Bank (5,000)  
Interest Paid on Debentures (9,000)  
Proposed Dividend (10,000)  
Repayment of Debentures (80,000)  
Repayment of Bank Loan (50,000)  
Proceeds from Equity Share Capital 50,000  
Proceeds from Preference Share Capital 50,000  
Bank Overdraft (15,000) (69,000)
Net Cash From Financing Activities (C)   (69,000)
Net Increase in Cash (A + B + C)   11,000
Add: Opening Cash and Cash Equivalents   20,000
Closing Cash and Cash Equivalents   31,000
     
     

Working Note:-
 
Fixed Assets  Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 4,10,000 Depreciation A/c 10,000
    Balance c/d 4,00,000
       
  4,10,000   4,10,000
       



Page No 3.111:

Answer:

Cash Flow Statement
For the Year Ending March31,2015
Particulars Details
(Rs)
Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   40,000
+ Provision for Tax    
+ General Reserve    
+ Proposed Dividend    
  Add: Non Operating Expenses    
Depreciation on Building 20,000  
Depreciation on Plant 10,000  
Interest Paid on Deposits 19,200  
Interest Paid on Debentures 14,400 63,600
  Less: Non Operating Incomes  
     
Operating Profit Before Working Capital Changes   1,03,600
  Add: Decrease in Current Assets & Increase in Current Liabilities    
Creditors 4,000  
Accrued Income 8,000  
Inventories 6,000 18,000
  Less: Increase in Current Assets & Decrease in Current Liabilities    
Prepaid Expenses (4,000)  
Bills Payable (4,000)  
O/standing Expenses (4,000)  
Debtors (30,000)  
Bills Receivables (2,000) (44,000)
     
Cash From Operating  Activities   77,600
Less: Tax Paid  
Net Cash From Operating  Activities (A)   77,600
     
Cash From Investing  Activities    
Purchase of Building (1,60,000)  
Purchase of Plant (50,000) (2,10,000)
     
Net Cash From Investing Activities (B)   (2,10,000)
     
Cash From Financing Activities    
Interest Paid on Deposit (19,200)  
Interest Paid on Debentures (14,400)  
Proceeds from Public Deposit 80,000  
Proceeds from Issue of Share Capital 60,000  
Proceeds from Issue of Debentures 36,000 1,42,400
     
     
Net Cash From Financing Activities (C)   1,42,400
Net Increase in Cash (A + B + C)   10,000
  Add: Opening Cash and Cash Equivalents   1,00,000
(Cash + Marketable Investments- Bank Overdraft)    
Closing Cash and Cash Equivalents   1,10,000
(Cash + Marketable Investments- Bank Overdraft)    
     

Working Note:-
 
Building Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount
(Rs)
Balance b/d 3,00,000 Depreciation A/c 20,000
Cash A/c (Balancing Figure) 1,60,000 Balance c/d 4,40,000
       
  4,60,000   4,60,000
       
 
Plant  Account
Dr.   Cr.
Particulars Amount
(Rs)
Particulars Amount (Rs)
Balance b/d 1,60,000 Depreciation A/c 10,000
Cash A/c (Balancing Figure) 50,000 Balance c/d 2,00,000
       
  2,10,000   2,10,000
       



Page No 3.83:

Answer:

Transaction Classified as Operating Activities
1. Cash Received from Debtors.
2. Cash Paid to Creditors.
3. Selling and Distribution Expenses.
4. Wages and Salaries.

Page No 3.83:

Answer:

Transaction Classified as Investing Activities
1. Proceeds from Sale of Investments.
2. Purchase of Debentures.
3. Dividend Received on Investments.
4. Public Deposits given.

Page No 3.83:

Answer:

Transaction Classified as Financing Activities
1. Loan taken from Bank.
2. Issue of Debentures.
3. Issue of Shares.
4. Redemption of Debentures.
5. Buy-Back of Shares.
6. Dividend Paid.

Page No 3.83:

Answer:

Transaction Classified as Operating Activities
1. Cash Sales.
2. Cash Purchases.
3. Salary and Wages.
4. Income Tax Refund.
5. Computer Maintenance Expenses.

Transaction Classified as Investing Activities
1. Purchase of Investments.
2. Dividend Received.

Transaction Classified as Financing Activities
1. Dividend Paid.
2. Issue of Shares.

Transaction Classified as Cash and Cash Equivalents Activities
1. Cash in Hand.
2. Cash at Bank.



Page No 3.84:

Answer:

Transaction Classified as Operating Activities
1. Selling Expenses.
2. Cash Paid to Creditors.
3. Salaries Paid.
4. Marketing Expenses

Transaction Classified as Investing Activities
1. Purchase of Patents.
2. Sale of Goodwill.
3. Sale of Investments.

Transaction Classified as Financing Activities
1. Buy- Back of Shares.
2. Issue of Shares.
3. Loan taken.
4. Redemption of Preference Shares.

Transaction Classified as Cash and Cash Equivalents Activities
1. Fixed Deposit with Bank.
2. Marketable Securities.

Page No 3.84:

Answer:

Transaction Classified as Operating Activities
1. Rent received by a Real Estate Company.

Transaction Classified as Investing Activities
1. Purchase of Investments.
2. Dividend Received.
3. Rent Received by a Trading Company.

Transaction Classified as Financing Activities
1. Dividend Paid.
2. Interest Paid on Borrowings.
3. Proceeds from Issue of Debentures.

Transaction Classified as Cash and Cash Equivalents Activities
1. Marketable Securities.

Page No 3.84:

Answer:

Calculation of Net Profit Before Tax
For the Year Ending March31,2015
Particulars Details
(Rs)
Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   55,000
+ Provision for Tax   50,000
+ Proposed Dividend   50,000
Net Profit Before Tax   1,55,000
     
     



Page No 3.85:

Answer:

Calculation of Operating Profit before working Capital Changes
For the Year Ending …….
Particulars Details
(Rs)
Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   6,00,000
+ Provision for Tax    
+ Reserve    
+ Dividend    
Add: Non Operating Expenses
   
 Goodwill written off 30,000  
 Depreciation on Fixed Assets 1,40,000  
 Premium paid on Redemption of Debentures 10,000  
 Interest on Debentures 28,000  
 Share Issue Expenses Written Off 1,000  
 Loss on Sale of Machinery 30,000 2,39,000
Less: Non Operating Incomes
   
Profit on Sale of Investment (20,000)  
Interest and Dividend received on Investment (46,000) (66,000)
     
Operating Profit Before Working Capital Changes   7,73,000
     

Page No 3.85:

Answer:

Calculation of Operating Profit before working Capital Changes
For the Year Ending March 31,2015
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   1,20,000
+ Provision for Tax   1,50,000
+ Investment Fluctuation Reserve   10,000
+ Bad Debts   5,000
–Excess Provision Written Back   (5,000)
    2,80,000
Add: Non Operating Expenses
   
 Depreciation on Fixed Assets 50,000 50,000
Less: Non Operating Incomes
 
     
Operating Profit Before Working Capital Changes   3,30,000
     



Page No 3.86:

Answer:

Calculation of Operating Profit before working Capital Changes
For the Year Ending March 31,2015
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   1,50,000
+ Provision for Tax   2,50,000
+ Investment Fluctuation Reserve   40,000
+ Bad Debts   15,000
+ General Reserve   50,000
+ Proposed Dividend   1,20,000
-Excess Provision Written Back   (5,000)
    6,20,000
Add: Non Operating Expenses
   
Depreciation on Fixed Assets 1,10,000 1,10,000
Less: Non Operating Incomes
   
Dividend Received on Investments (10,000) (10,000)
Operating Profit Before Working Capital Changes   7,20,000
     



Page No 3.87:

Answer:

Cash Flow from Operating Activities
For the Year Ending March 31,2015
Particulars Details
(Rs)
Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit 10,000  
+ Provision for Tax    
+ Reserve    
+ Dividend    
Add: Non Operating Expenses
   
Depreciation     5,000  
Less: Non Operating Incomes
   
     
Operating Profit Before Working Capital Changes   15,000
Add: Decrease in Current Assets & Increase in Current Liabilities
   
Debtors 10,000  
Bills Receivables 2,000  
Expenses Outstanding 1,000 13,000
Less: Increase in Current Assets & Decrease in Current Liabilities
   
Creditors (4,000)  
Bills Payables (13,000)  
Accrued Income (1,000) (18,000)
     
     
Cash From Operating  Activities   10,000
Less: Tax Paid
 
Net Cash From Operating  Activities (A)   10,000
     

Page No 3.87:

Answer:

Cash Flow from Operating Activities
For the Year Ending March 31,2015
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   5,000
+ Provision for Tax    
+ Reserve    
+ Dividend    
Add: Non Operating Expenses
   
     
Less: Non Operating Incomes
   
     
Operating Profit Before Working Capital Changes    
Add: Decrease in Current Assets & Increase in Current Liabilities
   
Creditors 6,000  
O/standing Rent 9,000  
Prepaid Insurance 2,000 17,000
    22,000
Less: Increase in Current Assets & Decrease in Current Liabilities
   
Debtors (6,000)  
Current Investments (2,000) (8,000)
Cash From Operating  Activities   14,000
Less: Tax Paid
 
Net Cash From Operating  Activities (A)   14,000
     

Note: Current investments are taken as 'Working Capital'.

Page No 3.87:

Answer:

Cash Flow from Operating Activities
For the Year Ending March 31,2015
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   1,00,000
+ Provision for Tax    
+ Reserve    
+ Dividend    
Add: Non Operating Expenses
   
Provision for Depreciation 20,000  
Goodwill Written Off 40,000 60,000
Less: Non Operating Incomes
   
     
Operating Profit Before Working Capital Changes   1,60,000
Add: Decrease in Current Assets & Increase in Current Liabilities
   
O/standing Expenses 14,000  
Prepaid Expenses 2,000 16,000
    1,76,000
Less: Increase in Current Assets & Decrease in Current Liabilities
   
Debtors (80,000)  
Inventories (40,000) (1,20,000)
     
Cash From Operating  Activities   56,000
Less: Tax Paid
 
     
Net Cash From Operating  Activities (A)   56,000
     

Page No 3.87:

Answer:

Cash Flow from Operating Activities
For the Year Ending …..
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   4,00,000
+ Provision for Tax    
+ General Reserve   25,000
+ Dividend    
Add: Non Operating Expenses
   
Depreciation on Fixed Assets 50,000 50,000
Goodwill written off 5,000 5,000
Less: Non Operating Incomes
   
Profit on Sale of Land (50,000) (50,000)
Operating Profit Before Working Capital Changes   4,30,000
Add: Decrease in Current Assets & Increase in Current Liabilities
   
Bills Receivable 2,000  
Prepaid Expenses 2,000 4,000
Less: Increase in Current Assets & Decrease in Current Liabilities
   
Debtors (3,000)  
Creditors (5,000) (8,000)
     
Cash From Operating  Activities   4,26,000
Less: Tax Paid
 
Net Cash From Operating Activities (A)   4,26,000
     



Page No 3.88:

Answer:

Cash Flow from Operating Activities
For the Year Ending ………
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   1,50,000
+ Provision for Tax    
+ Debenture Redemption Reserve   50,000
+ Dividend    
Add: Non Operating Expenses
   
Provision for Depreciation 1,90,000 1,90,000
Goodwill written off 50,000 50,000
Less: Non Operating Incomes
   
Profit on Sale of Plant (60,000) (60,000)
Operating Profit Before Working Capital Changes   3,80,000
Add: Decrease in Current Assets & Increase in Current Liabilities
   
Debtors 50,000 50,000
Less: Increase in Current Assets & Decrease in Current Liabilities
   
O/standing Expenses (30,000) (30,000)
     
Cash From Operating  Activities   4,00,000
Less: Tax Paid
 
     
Net Cash From Operating  Activities (A)   4,00,000
     
 
Provision for Depreciation Account
Dr.   Cr.
Particulars  Amount
(Rs)
Particulars Amount
(Rs)
Plant A/c 90,000 Balance b/d 3,00,000
Balance c/d 4,00,000 Depreciation (Balancing Figure) 1,90,000
       
  4,90,000   4,90,000
       

Page No 3.88:

Answer:

Cash Flow from Operating Activities
For the Year Ending …..
Particulars Details (Rs) Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   2,50,000
+ Provision for Tax   1,50,000
+ Reserve   2,00,000
+ Dividend    
Add: Non Operating Expenses
   
Depreciation 2,50,000  
Goodwill written off 80,000  
Loss on Sale of Machinery 2,50,000 5,80,000
Less: Non Operating Incomes
 
     
Operating Profit Before Working Capital Changes   11,80,000
Add: Decrease in Current Assets & Increase in Current Liabilities
   
Debtors 1,28,000  
O/standing Expenses 15,000  
Prepaid Expenses 20,000 1,63,000
Less: Increase in Current Assets & Decrease in Current Liabilities
   
Bills Payable (47,000)  
Current Investments (1,50,000) (1,97,000)
Cash From Operating Activities   11,46,000
Less: Tax Paid
  (3,50,000)
Net Cash From Operating Activities (A)   7,96,000
     

Page No 3.88:

Answer:

Cash Flow from Operating Activities
For the Year Ending March 31,2015
Particulars Details (Rs) Amount (Rs)
Cash Flow from Operating Activities    
Net Profit   18,000
+ Provision for Tax   50,000
+ General Reserve   30,000
+ Proposed Dividend   50,000
Add: Non Operating Expenses
   
Depreciation 30,000 30,000
Goodwill written off 25,000 25,000
Loss on Sale of Machinery    
Less: Non Operating Incomes
 
     
Operating Profit Before Working Capital Changes   2,03,000
Add: Decrease in Current Assets & Increase in Current Liabilities
   
Stock 10,000  
Creditors 28,000 38,000
Less: Increase in Current Assets & Decrease in Current Liabilities
   
Debtors (92,000)  
O/Standing Current Liabilities (4,000) (96,000)
Cash From Operating  Activities   1,45,000
Less: Tax Paid
  (40,000)
Net Cash From Operating  Activities (A)   1,05,000
     



Page No 3.89:

Answer:

Cash From Investing  Activities
For the Year Ending …….
Particulars Details
(Rs)
Amount
(Rs)
Cash From Investing  Activities    
Purchase of Investment (5,00,000)  
Proceeds from Sale of Investments 6,00,000  
Purchase of Goodwill (2,50,000)  
Purchase of Machinery (7,40,000)  
Proceeds from Sale of Machinery 1,00,000  
Proceeds from Sale of Patents 1,00,000  
Interest received on Investments 80,000  
Dividend Received on Shares 40,000  
Rent Received ( Land used for Commercial Purpose) 80,000  
     
Net Cash From Investing Activities   (4,90,000)
     

Page No 3.89:

Answer:

Cash From Investing  Activities
For the Year Ending March 31,2015
Particulars Details
(Rs)
Amount
(Rs)
Cash From Investing  Activities    
     
Purchase of Patents (40,000)  
Proceeds from Sale of Land 40,000  
Purchase of Furniture (4,60,000)  
Proceeds from Sale of Investment 40,000  
Accrued Interest on Investment 20,000  
     
Net Cash From Investing Activities    (4,00,000)
     
     



Page No 3.90:

Answer:

Cash From Investing Activities
For the Year Ending March 31,2015
Particulars Details (Rs) Amount (Rs)
Cash From Investing Activities    
     
Proceeds from Sale of Investments (2, 50,000+10%) 2,75,000  
Interest received on Investments 70,000  
Dividend Received on Investment 30,000  
Purchase of Investment (7,50,000)  
Rent Received 20,000  
Purchase of Fixed Assets (23,80,000 + 2,00,000 – 19,50,000) (6,30,000)  
     
Net Cash From Investing Activities   (9,85,000)
     
     

Page No 3.90:

Answer:

Cash From Investing Activities
For the Year Ending March 31,2015
Particulars Details
(Rs)
Amount
(Rs)
Cash From Investing Activities    
     
Proceeds from Sale of Plant & Machinery 2,50,000  
Purchase of Plant & Machinery (8,00,000 + 2,50,000 – 6,00,000) (4,50,000)  
Purchase of Non Current Investment (50,000)  
     
Net Cash From Investing Activities   (2,50,000)
     

Page No 3.90:

Answer:

Cash From Investing  Activities
For the Year Ending March 31,2015
Particulars Details (Rs) Amount
(Rs)

Cash From Investing  Activities

   
     
Dividend Received on Investment 5,000  
Sale of Non Current Investments 2,00,000  
     
Net Cash From Investing Activities    2,05,000
     



Page No 3.91:

Answer:

Cash From Financing Activities
For the Year Ending March 31,2015
Particulars Details (Rs)
Amount
(Rs)
Cash From Financing Activities    
Interest Paid on Debentures (18,000)  
Proceeds from Issue of Share Capital (1,00,000 +10,000) 1,10,000  
Redemption of Debenture (50,000 + 5,000) (55,000)  
     
Net Cash From Financing Activities   37,000
     

Page No 3.91:

Answer:

Cash From Financing Activities
For the Year Ending March 31,2015
Particulars Details
(Rs)
Amount
(Rs)
Cash From Financing Activities    
Interest Paid on Debentures (10,000)  
Dividend Paid (50,000)  
Proceeds from Issue of Share Capital 2,00,000  
Redemption of 10% Debenture (2,00,000)  
Proceeds from Issue of 8% Debenture 3,00,000  
Repayment of Bank Loan (1,50,000)  
Bank Overdraft 50,000  
Interest paid on Bank Overdraft (1,000)  
Net Cash From Financing Activities   1,39,000
     



Page No 3.92:

Answer:

Cash From Financing Activities
For the Year Ending March 31,2015
Particulars Details
(Rs)
Amount
(Rs)
Cash From Financing Activities    
Dividend Paid on Preference Share Capital (4, 00,000 × 10%) (40,000)  
Interim Dividend Paid (6, 00,000 × 15%) (90,000)  
Redemption of Preference Shares (2, 00,000 + 5%) (2,10,000)  
Proceeds from Issue of Equity Share Capital 2,00,000  
Premium Received from Equity Share 25,000  
Proceeds from Issue of Debentures 2,00,000  
Interest Paid on Debentures (48,000 – 9,600) (38,400)  
     
Net Cash From Financing Activities   46,600
     

Page No 3.92:

Answer:

Cash From Financing Activities
For the Year Ending March 31,2014
Particulars Details
(Rs)
Amount
(Rs)
Cash From Financing Activities    
Proceeds from Issue of Equity Share Capital (15,00,000+ 75,000) 15,75,000  
Share Issue Expenses Paid (1,75,000)  
Bank Overdraft 1,00,000  
Net Cash From Financing Activities   15,00,000
     



Page No 3.93:

Answer:

Cash Flow from Operating Activities
For the Year Ending March31,2014
Particulars Details
(Rs)
Amount
(Rs)
Cash Flow from Operating Activities    
Net Profit   5,00,000
+ Provision for Tax    
+ Reserve    
+ Dividend    
  Add: Non Operating Expenses    
Premium on Redemption of Preference Share 25,000 25,000
Interim Dividend 2,40,000 2,40,000
Proposed Dividend (10, 00,000 × 10%) 1,00,000 1,00,000
     
  Less: Non Operating Incomes  
     
Operating Profit Before Working Capital Changes    
  Add: Decrease in Current Assets & Increase in Current Liabilities    
     
  Less: Increase in Current Assets & Decrease in Current Liabilities    
     
    9,65,000
Cash From Operating  Activities    
    Less: Tax Paid    
Net Cash From Operating  Activities (A)   9,65,000
     
Cash From Financing Activities