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Question

Calculate Cash Flow from Operating Activities from the following details:
 
Particulars 31st March, 2019 (₹) 31st March, 2018 (₹)
Surplus, i.e., Balance in Statement of Profit and Loss 80,000 60,000
Trade Receivables 25,000 31,000
Provision for Depreciation 40,000 30,000
Inventories 80,000 60,000
Outstanding Rent 12,000 21,000
Goodwill 30,000 38,000
Prepaid Insurance 1,000 2,000
Trade Payables (Creditors) 13,000 19,000


Solution

 

Particulars

Amount

(₹)

Amount

(₹)

 

Profit as per Statement of Profit and Loss (Net Income)

 

20,000

 

Items to be Added:

 

 

 

 

Depreciation

10,000

 

 

 

Goodwill written off

8,000

18,000

 

Operating Profit before Working Capital Changes

 

38,000

 

Add: Decrease in Current Assets

 

 

 

 

 Trade Receivables

6,000

 

 

 

Prepaid Insurance

1,000

 

 

Less: Increase in Current Assets

 

 

 

 

    Inventories

(20,000)

 

 

Less: Decrease in Current Liabilities

 

 

 

 

    Outstanding Rent

(9,000)

 

 

 

Trade Payables

(6,000)

(28,000)

 

Cash Generated from operations

 

10,000

 

Less: Tax Paid

 

Nil

 

Net Cash Flows from Operating Activities

 

10,000


Accountancy
TS Grewal-II (2019)
All

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