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Question
Under which type of activity will you classify' Dividend received by a financial company' while preparing Cash Flow Statement?
Solution
Dividend received by a financial company is classified as cash from Operating Activities while preparing Cash Flow Statement.
RELATED QUESTIONS
Following is the Balance Sheet of K K Ltd as at 31-3-2015:
K.K. Ltd Balance Sheet as at 31-3-2015
| Particulars | Note No. | 31-3-2015 (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) Short – term borrowings b)Short – term provisions |
1
2
3 4 |
10,00,000 4,00,000
9,00,000
3,00,000 1,40,000 |
8,00,000 (1,00,000)
10,00,000
1,00,000 1,80,000 |
| Total | 27,40,000 | 19,80,000 | |
|
II. Assets 1. Non – Current Assets a) Fixed Assets Tangible assets Intangible assets b) Non – Current Investments 2. Current Assets a) Current Investments b) Inventories c) Cash and Cash |
5 6
7
|
20,06,000 40,000 2,00,000
1,00,000 2,14,000 1,80,000 |
14,40,000 60,000 1,50,000
1,20,000 90,000 1,20,000 |
| Total | 27,40,000 | 19,80,000 |
| 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) |
4,00,000 |
(1,00,000) |
| 4,00,000 | (1,00,000) | ||
|
2.
|
Long term borrowings : 12 % Debentures |
9,00,000 |
10,00,000 |
| 9,00,000 | 10,00,000 | ||
|
3.
|
Short – term borrowings : Bank Overdraft |
3,00,000 |
1,00,000 |
| 3,00,000 | 1,00,000 | ||
|
4.
|
Short – term provisions Provisions for tax |
1,40,000 |
1,80,000 |
| 1,40,000 | 1,80,000 | ||
|
5.
|
Tangible Assets Machinery Accumulated Depreciation |
24,06,000 (4,00,000) |
16,42,000 (2,02,000) |
| 20,06,000 | 14,40,000 | ||
|
6.
|
Intangible Assets Goodwill |
40,000 |
60,000 |
| 40,000 | 60,000 | ||
|
7.
|
Inventories Stock in trade |
2,14,000 |
90,000 |
| 2,14,000 | 90,000 |
Additional Information
(i) 12% Debentures were redeemed on 31-3-2015
(ii) Tax 1,40,000 was paid during the year
Prepare Cash flow Statement.
Following was the Balance Sheet of M.M Ltd at on 31.3.2015.
M.M. Ltd Balance Sheet as at 31-3-2015
| Particulars | Note No. | 31-3-2015 (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) Short – term borrowings b) Short – term provisions |
1
2
3 4 |
5,00,000 2,00,000
4,50,000
1,50,000 70,000 |
4,00,000 (50,000)
5,00,000
50,000 90,000 |
| Total | 13,70,000 | 9,90,000 | |
|
II. Assets 1. Non – Current Assets a) Fixed Assets Tangible assets Intangible assets b) Non – Current Investments 2. Current Assets a) Current Investments b) Inventories c) Cash and Cash Equivalents |
5 6
7
|
10,03,000 20,000 1,00,000
50,000 1,07,000 90,000 |
7,20,000 30,000 75,000
60,000 45,000 60,000 |
| Total | 13,70,000 | 9,90,000 |
| 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) |
2,00,000 |
(50,000) |
| 2,00,000 | (50,000) | ||
|
2.
|
Long term borrowings : 12 % Debentures |
4,50,000 |
5,00,000 |
| 4,50,000 | 5,00,000 | ||
|
3.
|
Short – term borrowings : Bank Overdraft |
1,50,000 |
50,000 |
| 1,50,000 | 50,000 | ||
|
4.
|
Short – term provisions Provisions for tax |
70,000 |
90,000 |
| 70,000 | 90,000 | ||
|
5.
|
Tangible Assets Machinery Accumulated Depreciation |
12,03,000 (2,00,000) |
8,21,000 (1,01,000) |
| 10,03,000 | 7,20,000 | ||
|
6.
|
Intangible Assets Goodwill |
20,000 |
30,000 |
| 20,000 | 30,000 | ||
|
7.
|
Inventories Stock in trade |
1,07,000 |
45,000 |
| 1,07,000 | 45,000 |
Additional Information
(i) 12% Debentures were redeemed on 31-3-2015
(ii) Tax Rs. 70,000 was paid during the year
Prepare Cash flow Statement.
State the primary objective of preparing a Cash Flow Statement.
'Interest received and paid' is considered as which type of activity by a finance company while preparing a Cash Flow Statement?
Amongst the following, 'Payment of bonus to the employees' by an insurance company is which type of activity?
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.
While preparing Cash Flow Statements what type of activity is, ‘Payments of Cash to acquire Debentures by an investment company?
‘Payment of dividend’ will come under which type of activity while preparing a Cash Flow Statement?
Redemption of debentures would result in inflow, outflow on no flow of cash? Give your answer with reason.
From the following Balance Sheets, Prepare a Cash Flow Statements as per AS- 3 (revised)
|
Liabilities |
2008 Amount Rs |
2009 Amount Rs |
Assets |
2008 Amount Rs |
2009 Amount Rs |
|
Share Capital |
12,000 |
15,000 |
Furniture |
5,000 |
8,000 |
|
P & L Account |
5,000 |
6,000 |
Stock |
6,000 |
4,000 |
|
Creditors |
15,000 |
11,000 |
Debtors |
10,000 |
8,000 |
|
|
|
|
Cash |
11,000 |
12,000 |
|
|
32,000 |
32,000 |
|
32,000 |
32,000 |
|
|
|
|
|
|
|
A dividend of Rs 3,000 was paid during the year 2008-09
You are required to prepare a Cash-Flow Statement (as per AS-3)
for the year 2016-17 from the following Balance Sheet.
Balance Sheet of Honesty Ltd.
As at 31st March, 2016 and 31st March, 2017
| I | Particulars | Note No. | 31.03.2017 |
31.03.2017 |
| 1. |
EQUITY AND LIABILITIES |
1. |
14,00,000 5,00,000
|
10,00,000 4,00,000
|
| 2. | Non-Current Liabilities Long Term Borrowing (10% Debentures) |
5,00,000 | 1,40,000 | |
| 3. | Current Liabilities (a) Short Term Borrowings (Bank Overdraft) (b) Trade Payables (Creditors) (c) Short Term Provisions |
20,000 1,00,000 60,000 |
30,000 60,000 30,000 |
|
| TOTAL | 25,80,000 | 16,60,000 | ||
| II 1. | ASSETS Non-Current Assets Fixed Assets (i) Tangible (ii) Intangible (Goodwill) |
2. |
16,00,000 1,40,000 |
9,00,000 2,00,000 |
| 2. | Current Assets (a) Inventories (b) Trade Receivables (c) Cash and Bank Balances (Cash at Bank) |
2,50,000 5,00,000 90,000 |
2,00,000 3,00,000 60,000 |
|
| TOTAL | 25,80,000 | 16,60,000 |
Notes to Accounts:
| Particulars | 31.03.2017 | 31.03.2016 |
| 1. Short term provisions provision for taxation |
60,000 | 30,000 |
| 2. Fixed Assets (Tangible) Plant and Machinery Less Accumulated Depreciation |
17,60,000 (1,60,000) |
10,00,000 (1,00,000) |
| 16,00,000 | 9,00,000 |
During the year 2016-17:
(i) A part of the machine, costing Rs. 50,000, accumulated depreciation thereon being Rs. 20,000, was sold for
Rs.18,000.
(ii) Tax paid Rs. 20,000.
(iii) Interest of Rs. 50,000 paid on Debentures.
The following is the Profit and Loss Account of Yamuna Limited:
|
Statement of Profit and Loss of Yamuna Ltd., for the Year ended March 31, 2017 |
|||
| Particulars | Note No. | Amount (₹) | |
| i) | Revenue from Operations | 10,00,000 | |
| ii) | Expenses | ||
|
|
Cost of Materials Consumed | 1 | 50,000 |
| Purchase of Stock-in-trade | 5,00,000 | ||
| Other Expenses | 2 | 3,00,000 | |
| Total Expenses | 8,50,000 | ||
| iii) | Profit before Tax (i – ii) | 1,50,000 | |
Additional information:
- Trade receivables decrease by Rs 30,000 during the year.
- Prepaid expenses increase by Rs 5,000 during the year.
- Trade payables increase by Rs 15,000 during the year.
- Outstanding expenses payable increased by Rs 3,000 during the year.
- Other expenses included a depreciation of Rs 25,000.
Compute net cash from operations for the year ended March 31, 2017 by the indirect method.
Following are the extracts from the Balance Sheet of MAH Ltd. as at 31st March, 2019
|
Particular |
31st March 2019 (₹) |
31st March 2018 (₹) |
| Surplus, i.e., Balance in Statement of Profit and Loss |
10,00,000 |
5,00,000 |
| Dividend Payable |
50,000 |
– |
Additional Information: Proposed Dividend for the years ended 31st March, 2018 and 2019 are ₹ 4,00,000 and ₹ 5,00,000 respectively.
Prepare the Note to show Net Profit before Tax and Extraordinary Items.
Answer the following question:
State giving reason, whether the issue of shares for consideration other than cash will result into inflow, outflow or no flow of cash.
Classify the following activity into operating activities, investing activities, financing activities or cash activities ·
"Proceeds from long-term borrowings."
What is the primary objective of cash flow statement?
Which of the following transactions will not result into flow of cash?
Which of the following transactions will not result in flow of cash:
From the following Balance Sheets of Rainbow Ltd., you are required to prepare a Cash Flow Statement (as per As 3) for the year 2021 - 22.
| Balance Sheets of Rainbow Ltd. As at 31st March, 2022 and 31st March, 2021 |
|||
| Particulars | Note no. | 31.3.2022 (₹) |
31.3.2021 (₹) |
| I. Equity and liabilities | |||
| 1. Shareholder's Funds | |||
| (a) Share Capital (Equity) | 4,00,000 | 4,00,000 | |
| (b) Reserve and Surplus | 1 | 1,60,000 | 1,20,000 |
| 2. Non-Current Liabilities | |||
| Long-term Borrowings (5% Debentures) | 3,50,000 | 2,60,000 | |
| 3. Current Liabilities | |||
| Short term Provision (Provision for Tax) | 30,000 | 25,000 | |
| Total | 9,40,000 | 8,05,000 | |
| II. Assets | |||
| 1. Non-Current Assets | |||
| Property, Plant & Equipment & Intangible Assets | |||
| (i) Property, Plant & Equipment (Plant & Machinery) | 6,00,000 | 7,80,000 | |
| 2. Current Assets | |||
| Cash & Bank Balances (Cash at Bank) | 3,40,000 | 25,000 | |
| Total | 9,40,000 | 8,05,000 | |
Notes to Accounts:
| Particulars | 31.3.2022 (₹) | 31.3.2021 (₹) |
| I. Reserves and Surplus | ||
| General Reserve | 30,000 | 20,000 |
| Balance in Statement of Profit and Loss | 1,30,000 | 1,00,000 |
Additional Information:
During the year 2021-22, the company:
- Sold a machine for ₹ 90,000 at a loss ₹10,000.
- Issued the 5% Debentures on 31st March; 2022, at a discount of 10%. The discount was written off from General Reserve.
