Question

Following is the Balance Sheet of SN Ltd as at 31-3-2015:

                                                     S.N Ltd Balance Sheet as at 31-3-2015

Particulars	Note No.	31-03-2015 (Rs.)	31-03-2014 (Rs.)
I. Equity and Liabilities        1. Shareholder’s Funds                a. Share Capital                b. Reserve and Surplus        2. Non - Current Liabilities                 a) Long – term borrowings        3. Current Liabilities                 a) Short – term borrowings                 b) Short – term provisions	1   2   3 4	2,50,000 1,00,000   2,25,000   75,000 35,000	2,00,000 (25,000)   2,50,000   25,000 45,000
Total		6,85,000	4,95,000
II. Assets        1. Non – Current Assets                 a) Fixed Assets                       Tangible assets                       Intangible                  b) Non – Current Investments          2. Current Assets                  a) Current Investments                   b) Inventories                   c) Cash and Cash Equivalents	5 6       7	5,01,500 10,000 50,000   25,000 53,500 45,000	3,60,000 15,000 37,500   30,000 22,500 30,000
Total		6,85,000	4,95,000

 

Note No.	Particulars	31-3-2015 (Rs.)	31-3-2014 (Rs.)
1.	Reserve and Surplus (Surplus i.e. Balance in Statement of Profit and Loss)	1,00,000	(25,000)
		1,00,000	(25,000)
2.	Long term borrowings : 12 % Debentures	2,25,000	2,50,000
		2,25,000	2,50,000
3.	Short – term borrowings : Bank Overdraft	75,000	25,000
		75,000	25,000
4.	Short – term provisions Provisions for tax	35,000	45,000
		35,000	45,000
5.	Tangible Assets Machinery Accumulated Depreciation	6,01,500 (1,00,000)	4,10,500 (50,500)
		5,01,500	3,60,000
6.	Intangible Assets Goodwill	10,000	15,000
		10,000	15,000
7.	Inventories Stock in trade	53,500	22,500
		53,500	22,500

Additional Information

(i) 12% Debentures were redeemed on 31-3-2015

(ii) Tax Rs.35,000 was paid during the year

Prepare Cash flow Statement

Answer 1

                                                                         Cash Flow Statement

                                                           for the year ended 31st March 2015

	Particulars	Amount (Rs.)	Amount (Rs.)
I	Cash Flow from Operating Activities A. Net Profit before Tax and Extraordinary items*      Adjustments for Non-Cash and Non – Operating Items B. Add : Items to be added Depreciation Intangible Assets Written off Interest on Debentures (12% of 5,00,000) Provision for Tax   C. Less : Items to be Deducted   D. Operating Profit before Working Capital Adjustments (A+B-C) E. Add : Decrease in Current Assets and Increase in Current Liabilities F: Less : Increase in Current Assets and Decrease in Current Liabilities Inventories            Cash Generated from Operations (D+E-F) Less : Income Tax Paid (Net of Refund)            Net Cash Flows from (or used in) Operating Activities	49,000 5,000 30,000 25,000 ____________   ____________     31,000   ____________   35,000 ____________	1,25,000           1,09,500     ___________ 2,34,500   (31,000)   __________ 2,03,500 (35,000) ___________ 1,68,500
II	Cash Flow from Investing Activities Purchase of Fixed Assets (6,01,500 – 4,10,500) Purchase of Non – Current Investments   Net Cash Flows (or used in) Investing Activities	(1,91,000) (12,500)	(2,03,500)
III	Cash Flow from Financing Activities Proceeds from Issue of Share Capital Redemption of Debentures Interest Paid on Debentures Increase in Bank Overdraft               Net Cash Flow from Financing Activities	50,000 (25,000) (30,000) 50,000	45,000
IV	Net Increase or Decrease in Cash and Cash Equivalents (I+ II+III)            Add : Cash and Cash Equivalents in the beginning of the period             (includes Current Investments of 30,000)		10,000 60,000
	Cash and Cash Equivalents at the end of the period (Includes Current Investments of 25,000)		70,000

 

                                            Provision For Tax Account

Dr.                                                                                                             Cr.

Particulars	Amount (Rs.)	Particulars	Amount (Rs.)
To Bank A/c To Balance c/d	35,000 35,000	By Balance b/d By Statement of Profit and Loss	45,000 25,000
	70,000		70,000