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प्रश्न
While preparing the Cash Flow Statement the accountant of Gulfam Ltd., a financing company showed Dividend received on Investments as Investing Activity. Was he correct in doing so? Give reason.
उत्तर
Dividend received on investments is cash flow from operating activities. Therefore, it is to be
categorised under 'Cash Flow from Operating Activities'. Thus, the accountant was incorrect in his
approach of showing it under 'Investing Activity'.
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संबंधित प्रश्न
'Interest received and paid' is considered as which type of activity by a finance company while preparing a Cash Flow Statement?
State whether the following will increase, decrease or have no effect on cash flow from operating activities while preparing 'Cash Flow Statement':
1) A decrease in outstanding employees benefits expenses by Rs 3,000
2) Increase in prepaid insurance by Rs 2,000
While preparing Cash Flow statement of Sharda Ltd. 'Depreciation provided on fixed assets' was added to net profit to calculate cash flow from operating activities. Was the accountant correct in doing so? Give reason.
Which of the following transactions will result in the flow of cash?
(1) Cash was withdrawn from bank Rs 20,000.
(2) Issued Rs 20,000; 9% debentures for the vendors of machinery.
(3) Received Rs 19,000 from debtors.
(4) Deposited cheques of Rs 10,000 into the bank
The accountant of Manav Ltd. while preparing Cash Flow Statement added depreciation provided on fixed assets to net profit for calculating cash flow from operating activities. Was he correct in doing so? Give reason.
Which of the following transactions will result in the flow of cash :
(1) Deposited Rs 43,000 into the bank.
(2) Withdrew cash from bank Rs 23,000.
(3) Sale of the machinery of the book value of Rs 38,000 at a loss of Rs 3,000.
(4) Converted Rs 2,00,000, 9% debentures into equity shares.
Prepare a Cash Flow Statement from the information given in the balance sheet of Simco Ltd. As at 31-3- 2013and 31-3-2012:
| Particulars | Note No. |
31-3-2013 Rs |
31-3-2012 Rs |
|
I. Equity and Liabilities 1. Shareholders' Funds a. Equity Share Capital b. Reserves and Surplus 2. Non-current Liabilities a. Long term-borrowing 3. Current liabilities a. Trade Payables |
2,00,000 90,000
87,500
10,000 |
1,50,000 75,000
87,500
76,000 |
|
| Total | 3,87,500 | 3,87,500 | |
|
II. Assets 1. Non- Current assets a. Fixed assets i. Tangible assets b. Non –Current Investment 2. Current assets a. Current-Investment (marketable) b. Inventory c. Trade receivable d. Cash and Cash equivalents |
1,87,500 1,05,000
12,500 4,000 9,500 68,500 |
1,40,000 1,02,500
33,500 5,500 23,000 84,000 |
|
| Total | 3,87,500 | 3,88,500 |
Notes to Account:
Note -1
| Particulars |
2013 Rs |
2012 Rs |
| Reserve and Surplus | ||
| Surplus( balance in the statement of profit and loss) | 90,000 | 75,000 |
Why is specific disclosure of cash flow financing activities important while preparing Cash Flow Statement?
Following is the Balance Sheet of Wisben Ltd. As on 31st March 2012
| Balance Sheet of Tiger Super Steel Ltd. | |||
| Particulars | Note No. |
2012 Rs |
2011 Rs |
|
I. Equity and Liabilities 1. Shareholders' Funds a. Share Capital b. Reserves and Surplus (Profit & Loss Balance) 2. Non-Current Liabilities a. Long Term-Borrowing 3. Current Liabilities a. Trade Payables |
7,00,000 2,00,000
3,00,000
30,000 |
6,00,000 1,10,000
2,00,000
25,000 |
|
| Total | 12,30,000 | 9,35,000 | |
|
II. Assets 1. Non- Current assets a. Fixed assets i. Tangible assets b. Non –Current Investment 2. Current assets a. Inventory b. Trade Receivable c. Cash and Cash Equivalents |
11,00,000
70,000 32,000 28,000 |
8,00,000
60,000 40,000 35,000 |
|
| Total | 12,30,000 | 9,35,000 | |
Adjustments:
During the year a piece of machinery of the book value of Rs 80,000 was sold for Rs 65,000. Depreciation provided on tangible assets during the year amounted to Rs 2,00,000.
Prepare a Cash Flow Statement.
While preparing Cash Flow Statements what type of activity is, ‘Payments of Cash to acquire Debentures by an investment company?
Give the meaning of ‘Cash Flow’.
Anand Ltd., arrived at a net income of Rs 5,00,000 for the year ended March 31, 2017. Depreciation for the year was Rs 2,00,000. There was a profit of Rs 50,000 on assets sold which was transferred to Statement of profit and Loss account. Trade Receivables increased during the year Rs 40,000 and Trade Payables also increased by Rs 60,000. Compute the cash flow operating activities by the indirect approach.
From the information given below you are required to calculate the cash paid for the inventory:
|
Particulars |
(Rs) |
|
Inventory in the beginning |
40,000 |
|
Credit Purchases |
1,60,000 |
|
Inventory in the end |
38,000 |
|
Trade payables in the beginning |
14,000 |
|
Trade payables in the end |
14,500 |
From the following Balance Sheet of Mohan Ltd., prepare cash flow Statement:
Balance Sheet of Mohan Ltd.,
as at 31st March 2016 and 31 March 2017
| Particulars | Note No. | March 31, 2017 (Rs) |
March 31, 2016 (Rs) |
| I) Equity and Liabilities | |||
|
1. Shareholders’ Funds |
|||
|
a) Equity share capital |
3,00,000 | 2,00,000 | |
|
b) Reserves and surplus |
2,00,000 | 1,60,000 | |
|
2. Non-current liabilities |
|||
|
a) Long-term borrowings |
1 | 80,000 | 1,00,000 |
|
3. Current liabilities |
|||
|
Trade payables |
1,20,000 | 1,40,000 | |
|
Short-term provisions |
2 | 70,000 | 60,000 |
| Total | 7,70,000 | 6,60,000 | |
| II) Assets | |||
|
1. Non-current assets |
|||
|
Fixed assets |
3 | 5,00,000 | 3,20,000 |
|
2. Current assets |
|||
|
a) Inventories |
1,50,000 | 1,30,000 | |
|
b) Trade receivables |
4 | 90,000 | 1,20,000 |
|
c) Cash and cash equivalents |
5 | 30,000 | 90,000 |
| Total | 7,70,000 | 6,60,000 |
Notes to accounts:
|
|
2017 | 2016 |
| 1. Long-term borrowings | ||
|
Bank Loan |
80,000 | 1,00,000 |
| 2. Short-term provision | ||
|
Proposed dividend |
70,000 | 60,000 |
| 3. Fixed assets | 6,00,000 | 4,00,000 |
|
Less: Accumulated Depreciation |
1,00,000 | 80,000 |
|
(Net) Fixed Assets |
5,00,000 | 3,20,000 |
| 4. Trade receivables | ||
|
Debtors |
60,000 | 1,00,000 |
|
Bills receivables |
30,000 | 20,000 |
|
|
90,000 | 1,20,000 |
| 5. Cash and cash equivalents Bank | 30,000 | 90,000 |
Additional Information:
Machine Costing Rs. 80,000 on which accumulated depreciation was Rs. 50,000 was sold for Rs. 20,000.
Which one is Cash Outflows from investing activities?
Cash Flow Statement is based upon ______.
An example of Cash Flows from Operating Activity is ______
Cash flow example from an Investing activity is:
Which of the following is not an investing cash flow?
From the following information of Hoopla Ltd., you are required to prepare a Cash Flow Statement (as per AS 3) for the year 2021 - 22.
| Particulars | (₹) | |
| (i) | Profit for the year 2021-22, before considering dividend and tax but after taking into account the following items: |
15,80,000 |
| (a) Depreciation on Property, Plant & Equipment | 5,50,000 | |
| (b) Interest Payable on Bank Loan | 3,80,000 | |
| (c) Profit on sale of investments, the book value of which was ₹ 2,20 000. |
1,00,000 | |
| (ii) | During the year 2021-22: | |
| (a) The company | ||
| • Paid Tax (which was provided in 2020 - 21) | 4,40,000 | |
| • Issued 66,000 equity shares of ₹ 10 each | 6,60,000 | |
| • Repaid Bank Loan | 15,00,000 | |
| • Paid interest on Bank Loan | 3,00,000 | |
| • Paid Dividend | 5,00,000 | |
| (b) Trade payables decreased by | 10,000 | |
| (c) Cash at bank increased from ₹ 60,000 on 1st April, 2021 to ₹ 7,00,000 on 31st March, 2022. |
