Question

Following is the Balance Sheets of Solar Power Ltd as at 31.3.2014 :

Solar Power Ltd. Balance Sheet
Particulars	Note No.	31-3-2014 Rs	31-3-2014 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. Trade Payables     b. Short Term Provisions		24,00,000 6,00,000   4,80,000   3,58,000 1,00,000	22,00,000 4,00,000   3,40,000   4,08,000 1,54,000
Total		39,38,000	35,02,000
II. Assets 1. Non – Current Assets   a) Fixed Assets     (i) Tangible assets     (ii) Intangible   b) Non – Current Investments 2. Current Assets   a) Current Investment   b) Inventories   c) Trade Receivables   d)Cash and Cash		21,40,000 80,000       4,80,000 2,58,000 3,40,000 6,40,000	17,00,000 2,24,000       3,00,000 2,42,000 2,86,000 7,50,000
Total		39,38,000	35,02,000

Notes to Accounts

Note No	Particulars	As On 31-3-2014	As On 31-3-2013
1	Reserve and Surplus (Surplus i.e. Balance in Statement of Profit and Loss)	6,00,000	4,00,000
2	Tangible Assets Machinery    Less: Accumulated Depreciation	25,40,000 (4,00,000)	20,00,000 (3,00,000)
3	Intangible Assets Goodwill	80,000	2,24,0000

Additional Information:-

During the year a piece of machinery, costing Rs 48,000 on which accumulated depreciation was Rs 32,000, was sold at Rs 12,000.

Prepare Cash Flow Statement.

Answer 1

 

Cash Flow Statement for the year ended March 31, 2014
	Particulars	Rs	Rs
A	Cash Flow from Operating Activities Profit as per Statement of Profit and Loss                    Profit Before Taxation Items to be added Amortisation of Goodwill Depreciation Loss on Sale of Fixed Assets              Operating Profit before Working Capital Adjustments Less: Increase in Current Assets      Inventories      Trade Receivables Less : Decrease in Current Liablities      Trade Payables      Short – Term Provisions               Net Cash Generated from Operating Activities	2,00,000     1,44,000 1,32,000 4,000     (16,000) (54,000)   (50,000) (54,000)	2,00,000       2,80,000 4,80,000           (1,74,000) 3,06,000
B	Cash Flow from Investing Activities        Sale of Machinery        Purchase of Machinery                 Net Cash Used in Investing Activities	12,000 (5,88,000)	(5,76,000)
C	Cash Flow from Financing Activities        Proceeds from Issue of Share Capital        Proceeds from Long-Term Borrowings                  Net Cash Flow from Financing Activities	2,00,000 1,40,000	3,40,000
D	Net Increase or Decrease in Cash and Cash Equivalents      Add: Cash and Cash Equivalents at the beginning of the period Cash and Cash Equivalents at the end of the period		70,000 10,50,000 11,20,000

 

Machinery Account
Dr.			Cr.
Particulars	Rs	Particulars	Rs
To Balance b/d	20,00,000	By Bank A/c (Sale)	12,000
To Bank A/c (Purchase – al.Fig.)	5,88,000	By Depreciation on Part of Machinery A/c	32,000
		By Profit and Loss A/c (Loss on Sale)	4,000
		By Balance c/d	25,40,000
	25,88,000		25,88,000

 

Accumulated Depreciation Account
Dr.			Cr.
Particulars	Rs	Particulars	Rs
To Machinery A/c	32,000	By Balance b/d	3,00,000
To Balance c/d	4,00,000	By Profit and Loss A/c (Dep. charged during the year – Bal. Fig)	1,32,000
	4,32,000		4,32,000