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Question
From the following information, calculate Cash flow from Operating Activities.
| Particulars | 31 March 2023 | 31 March 2024 |
| Surplus i.e Balance in Statement of Profit and Loss | 6,00,000 | 5,00,000 |
| Provision for Tax | 1,00,000 | 1,20,000 |
| Trade Receivables | 2,00,000 | 2,40,000 |
| Trade Payables | 1,50,000 | 2,00,000 |
| Goodwill | 2,00,000 | 1,50,000 |
Additional Information:
Proposed Dividend for the year ended March 31, 2023 and March 31, 2024 was ₹ 1,50,000 and ₹ 1,80,000 respectively.
Ledger
Solution
| Cash flow from Operating Activities | ||
| Particulars | Details | Amount |
| Profit Earned during the year | (1,00,000) | |
| Add: | ||
| Proposed dividend of previous year | 1,50,000 | |
| Provision for tax for current year | 1,20,000 | |
| Profit before tax and extraordinary items | 1,70,000 | |
| Non-operating and Non Cash Items: | ||
| Add: Goodwill amortised | 50,000 | |
| Operating profit before tax and changes in working capital | 2,20,000 | |
| Add: Increase in trade payable | 50,000 | |
| Less: increase in trade receivables | (40,000) | |
| Cash generated from operations | 2,30,000 | |
| Less: Income tax paid | 1,00,000 | |
| Cash flow from operating activities | 1,30,000 | |
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