Question

Statement-I: ‘Shree Ltd.’ was carrying on a business of packaging in Delhi and earned good profits in the past years. The company wanted to expand its business and required additional funds. To meet its requirements, the company issued equity shares of ₹ 30,00,000. It purchased a computerized machine of ₹ 20,00,000. During the current year, the Net Profit of the company was ₹ 15,00,000. Cash flows from operating, investing and financing activities from the above transactions will be ₹ 15,00,000; (₹ 20,00,000); ₹ 30,00,000 respectively.

Statement-II: The patents of X Ltd. increased from ₹ 3,00,000 in 2021-22 to ₹ 3,50,000 in 2022-23. It will be taken as purchase of Patents of ₹ 50,000 and will be shown under Cash outflow from Investing Activities.

Options

• Both the statements are true.

• Both the statements are false.

• Only Statement-I is true.

• Only Statement-II is true.

Answer 1

Both the statements are true.