PROF HARPAL SINGH 9815625813 CASH FLOW STATEMENT

HARPAL COMMERCE TUTORIALS

H. NO. B-1-810/18Q, UPKAR NAGAR, CIVIL LINES, NEAR PAHWA
DHARAMSHALA

XII ASSIGNMENT: CASH FLOW

STATEMENT
OPERATING ACTIVITIES

Q1. [(₹1,23,000)]

31.03.2022 31.03.2023
Profit and loss balance 5,00,000 3,00,000
Accumulate depreciation 80,000 2,10,000
Debenture sinking fund 1,60,000 1,95,000
Outstanding expenses 16,000 24,000
Trade payables 75,000 91,000
Prepaid salaries 5,000 2,000
Goodwill 20,000 15,000
Trade receivables 2,10,000 2,40,000
Q2.

Particulars Note no. 31.03.2022 31.03.2021

i. Equity and liabilities
(1) Shareholder fund
(a) Share capital 4,00,000 3,00,000
(b) Reserve and surplus 1 1,70,000 80,000
(2) Non current liability
Long term borrowings 1,50,000 1,00,000
9% debentures
(3) Current liability 40,000 60,000
Trade payables
Total 7,60,000 5,40,000
ii. Assets
(1) Non current assets
(a) PPE and intangible
(i) PPE 2 5,50,000 3,30,000
(b) Non current
investments 3 50,000 40,000
(2) Current assets
(a) Trade receivables 83,000 1,14,000
(b) Cash and cash
equivalents 77,000 56,000
Total 7,60,000 5,40,000
PROF HARPAL SINGH 9815625813 CASH FLOW STATEMENT
Notes: 31.3.2022 31.03.2021

1. Reserves and surplus

General reserve 1,20,000 1,00,000
Profit and loss 50,000 (20,000)
2. PPE
Machinery 7,00,000 4,40,000
Less: provision for
Depreciation 1,50,000 1,10,000
3. Rate of interest on investments is 8%p.a.

Additional information

(i) Additional debentures were issued on 1st April 2021

(ii) Additional investment were made on 1st april 2021. [₹1,50,500]

Q3.

Particulars Amount
i. Revenue from operations 40,00,000
ii. Expenses:
Purchases 22,00,000
Changes in inventory (1,00,000)
Depreciation and amortisation 80,000
Other expenses 10,20,000
iii. Total expenses 32,00,000
iv. Profit before tax 8,00,000
Additional Information :

(i) Sundry Creditors increased by ₹40,000 during the year.

(ii) Sundry Debtors increased by ₹70,000 during the year.
(iii) Outstanding wages decreased by 10,000 during the year.
(iv) Bills Receivable decreased by ₹5,000 during the year.
(v) Prepaid expenses decreased by 20,000 during the year.

Compute net Cash from operations by the indirect method [₹7,65,000]

Q4.

Profit & Loss Balance on 1-4-2021 (Debit) 12,000

Profit & Loss Balance on 31-3-2022 (Credit) 60,000

Writing off Preliminary Expenses 10,000

Transfer to General Reserve 40,000

Transfer to Provision for Doubtful Debts 6,000

Increase in Trade Receivables 32,000

Trade Payables on 1-4-2021 60,000

Trade Payables on 31-3-2022 52,000

Prepaid Expenses on 1-4-2021 7,500

Prepaid Expenses on 31-3-2022 5,000

Outstanding Expenses on 1-4-2021 4,000 [₹86,500]

PROF HARPAL SINGH 9815625813 CASH FLOW STATEMENT
Q5.

Particulars 31.03.2019 31.3.2020

Surplus 71,000 89,000
Inventory 12,000 4,000
Trade receivables 58,000 45,000
Outstanding expenses 14,600 10,000
Goodwill 57,000 27,000
Cash in hand 9,000 12,000
Machinery 82,000 56,000
(i) A piece of machinery cosing ₹50,000 on which depreciation of ₹20,000 had been charged was sold for
10,000. Depreciation charged during the year was 18,000.
(ii) Income tax 23,000 was paid during the year.
(iii) Dividend paid during the year was 36,000. [1,38,400]

Q6. [₹24,500]

Note no amounts
(i) Revenue from operations 50,000
(ii) Other income 1 5,000
(iii) Total revenue 55,000
(iv) Expenses
Cost of material consumed 15,000
Finance cost (interest) 10,000
Depreciation and amortisation 2 7,000
Other expenses 3 13,000
Total expenses 45,000
(v) Profit after tax 10,000
(vi) Less: tax (8000)
(vii) Profit after tax 2,000
Notes to accounts:

1. Other income
Profit on sale on machinery 2,000
Income tax refund 3,000
2. Depreciation and amortisation
Depreciation 5,000
Goodwill amortised 2,000
3. Other expenses
Rent paid 10,000
Loss on sale of equipment 3,000

Additional information:

01.04.2019 31.03.2020
Provision for tax 10,000 13,000
Rent payable 2,000 2,500
Trade payables 21,000 25,000
Trade receivables 15,000 21,000
Inventories 25,000 22,000
Q7.

Particulars Note no 31.3.2020 31.3.2019

i. Equity and liabilities
1. Shareholders fund
(a) Share capital 1,02,000 84,000
PROF HARPAL SINGH 9815625813 CASH FLOW STATEMENT
(b) Reserve and surplus 1 36,000 22,560
2. Non current liability
Long term borrowings
10% debentures 60,000 48,000
3. Current liabilities
(a) Short term borrowings 10,000 5,000
(b) Trade paybales 28,800 36,000
(c) Short term provisions 16,800 18,000
(tax)

Total 2,53,600 2,13,560

ii. Assets:
1. Non current assets
(a) Fixed assets
(i) Tangibles 2 1,18,800 1,32,000
2. Current assets
(a) Inventories 61,800 45,600
(b) Trade receivables 33,600 27,600
(c) Cash and cash
equivalents 39,400 8360
Total 2,53,600 2,13,560
Notes to accounts:

1. Reserve and surplus

Profit and loss 15,600 5,760
General reserve 20,400 16,800
2. Tangible assets
Land and building 96,000 97,200
Plant and machinery 22,800 34,800

Additional information

(i) Tax paid during the year 2019-20 ₹14,400 which includes capital gain tax ₹10,000
(ii) Depreciation on plant during the year ₹14,400
(iii) Additional debenture issued on 1st august 2019. [14,000]

INVESTING ACTIVITIES

Q8.

1.04.2021 31.03.2022

Plant and machinery (WDV) 12,00,000 15,40,000

Information:

(i) Depreciation charged during the year ₹2,20,000

(ii) Plant and machinery costing ₹2,40,000 on which ₹90,000 had accumulated as depreciation was sold for
₹1,70,000 [₹5,40,000]

Q9.

31.03.2021 31.03.2022
Non current investment 8,00,000 10,00,000
Plant and machinery 15,00,000 18,20,000
Additional information:

(i) Half of the Non-Current investments held in the beginning of the year were sold at 15% profit.
PROF HARPAL SINGH 9815625813 CASH FLOW STATEMENT
(ii) (ii) Depreciation on Plant & Machinery was ₹1,60,000 for the year.
(iii) (iii) Interest received on Non-Current investments : ₹50,000.
(iv) (iv) Dividend received on Non-Current investments : ₹20,000.
(v) (v) Rent received: ₹25,000 [(5,25,000)]

Q10.

31.3.2021 31.3.2022
Plant and machinery 12,00,000 15,00,000
Investment (long term) 1,50,000 4,20,000
Land (at cost) 5,00,000 4,00,000
Additional Information:

(i) Depreciation charged on Plant and Machinery ₹72,000.

(ii) Plant and Machinery with a book value of ₹1,20,000 was sold for ₹75,000.
(iii) Investments were purchased for ₹3,00,000. Some investments were sold at a ( loss of 10,000. Interest
received on investments during the year 15,000,
(iv) Land was sold at a profit of ₹80,000. [(5,02,000)]

Q11.

31.03.2020 31.03.2019
Machinery 12,40,000 10,20,000
Goodwill 3,00,000 1,00,000
Patents 1,60,000 2,80,000
10% long term investments 1,60,000 60,000
Land investment 1,00,000 1,00,000
Shares of amartex 1,00,000 1,00,000
Additional Information:

(a) Patents were written-off to the extent of ₹40,000 and some Patents were sold at a profit of 20,000.
(b) A Machine of book value ₹80,000 (Depreciation provided thereon ₹60,000) was sold for 50,000. Depreciation
charged during the year was Rs 1,40,000.
(c) On 1 April, 2019, 10% Investments were purchased for ₹1,80,000 and some Investments were sold at a profit
of 20,000. Interest on Investment was received on March 31, 2020.
(d) Amartax Ltd., paid Dividend @ 10% on its shares.
(e) A plot of Land had been purchased for investment purposes and let out for commercial use and rent received
30,000. [₹(5,14,000)]
FINANCING ACTIVITIES

Q12.

31.03.2023 31.03.20222
Equity share capital 12,00,000 7,00,000
8% preference shares - 1,00,000
9% debentures 2,00,000 -
7% debentures - 1,00,000
Additional Information :

(i) Equity Shares were issued at a premium of 2%.

(ii) 8% Preference Shares were redeemed at a premium of 2%.

(iii) 9% Debentures were issued at a discount of 1% and 7% debentures were

redeemed at a premium of 5%. (iv) Underwriting commission on Equity Shares was paid @ 2.5% on issue price.
PROF HARPAL SINGH 9815625813 CASH FLOW STATEMENT
(v) Interest paid on 7% debentures ₹7,000.

(vi) Dividend paid on preference shares ₹8,000. [₹4,73,250]

Q13. Calculate cash flow from investing and financing

31.03.2019 31.03.2020
Machinery at cost 5,00,000 9,00,000
Accumulated depreciation 3,00,000 4,50,000
Equity share capital 35,00,000 45,00,000
Securities premium - 1,00,000
Bank loan 17,50,000 12,50,000
During the year 2019-20 a machine costing ₹2,00,000 was sold at a profit ₹1,50,000. Depreciation charged on
machinery during the year amounted to ₹2,50,000. [₹3,50,000 ;₹2,50,000]

Q14. Calculate cash flow from operating and financing

Note no. 31.03.2023 31.03.2022

i. Equity and liabilities
(1) Shareholders fund
(a) Share capital 1 7,00,000 7,50,000
(b) Reserves and surplus 2 3,35,000 -
(2) Non current liabilities
Long term borrowings
8% debentures 3,00,000 2,00,000
(3) Current liabilities 70,000 1,10,000
Total 14,05,000 10,60,000
ii. Assets
(1) Non current asssets
(a) PPE
(i) Machinery 8,60,000 6,20,000
(ii) Intangibles - 20,000
(goodwill)
(b) Non current 1,25,000 80,000
investment 4,20,000 3,40,000
(2) Current assets
Total 14,05,000 10,60,000
Notes to accounts: 31.03.2023 31.03.2022

1. Share capital
Equity share 5,00,000 4,50,000
5% preference shares 2,00,000 3,00,000
2. Reserves and surplus
Capital redemption 1,00,000 -
General reserve 1,35,000 1,00,000
Profit and loss 1,00,000 (1,00,000)

Additional information:

(i) Depreciation provided on Machinery ₹60,000.

(ii) ii) Preference shares were redeemed at a premium of 5% on 31st March, 2023.
(iii) Additional debentures were issued on 1st October, 2022.
(iv) Proposed dividend on equity share capital for previous year ended 31st March 2022 was paid @ 8%.
[₹3,71,000; ₹26,000]

Q15. Calculate cash flows from investing and financing activities

PROF HARPAL SINGH 9815625813 CASH FLOW STATEMENT
31.03.2023 31.03.2022
Plant and machinery 10,30,000 8,50,000
Accumulate depreciation 2,68,000 2,20,000
8% debentures 3,50,000 5,00,000
Bank overdraft 3,00,000 2,10,000
Additional information:

(i) During the year a machine costing ₹1,50,000 was sold at a loss of 44,000. Depreciation on Plant & Machinery
charged during the year amounted to 80,000.

(ii) Interest paid on Bank Overdraft amounted to ₹28,000

(iii) debentures were redeemed on 1st October 2022 at a premium of 4%. [₹2,56,000; ₹1,28,000]