For each of the following transactions, calculate the resulting Cash Flow and state the nature of Cash Flow, i.e., whether it is Operating, Investing or Financing:
(a) Acquired machinery for ₹2,50,000 paying 20% by cheque and executing a bond for the balance payable.
(b) Paid ₹2,50,000 to acquire shares in Informa Tech Ltd. and received a dividend of ₹50,000 after acquisition.
(c) Sold machinery of original cost of ₹2,00,000 with an accumulated depreciation of ₹1,60,000 for ₹60,000.

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Solution

(a) Investing Activity: 50,000
(b) Investing Activity: 2,00,000
(c) Investing Activity: 60,000

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Q. For each of the following, transactions, calculate the resulting cash flow and state the nature of cash flow viz. operating, investing and financing.
(a) Acquired machinery for Rs. 2,50,000 paying

20 %

by cheque and executing a bond for the balance payable.
(B) Paid Rs. 2,50,000 to acquire shares in Informa Tech and received a dividend of R.s 50,000 after acquisition.
(c) Sold machinery of original cost Rs. 2,00,000 with an accumulated depreciation of Rs. 1,60,000 for Rs. 60,000.

For each of the following transactions, calculate the resulting cash flow and state the nature of cash flow, viz., operating, investing and financing.

(a) Acquired machinery for Rs 2,50,000 paying 20% by cheque and executing a bond for the balance payable.

(b) Paid Rs 2,50,000 to acquire shares in Informa Tech. and received a dividend of Rs 50,000 after acquisition.

Q. Show an Accounting Equation for the following transactions:
(i) D. Mahapatra commenced business with cash ₹ 50,000 and ₹ 1,00,000 by cheque; goods ₹ 60,000; machinery ₹ 1,00,000 and furniture ₹ 50,000.
(ii) 1/3rd of above goods sold at a profit of 10% on cost and half of the payment is received in cash.
(iii) Depreciation on machinery provided @ 10%.
(iv) Cash withdrawn for personal use ₹ 10,000.
(v) Interest on drawings charged @ 5%.
(vi) Goods Sold to Gupta for ₹ 10,000 and received a Bill Receivable for the same amount for 3 months.
(vii) Received ₹ 10,000 from Gupta against the Bills Receivable on its maturity.

From the following information, calculate Cash Flow from Investing Activities

Particular	31^st March, 2019 (₹)	31^st March, 2018 (₹)
Plant and Machinery	10,00,000	8,50,000
Investment (Long-term)	1,00,000	40,000
Land (At Cost)	1,00,000	2,00,000

Additional Information:
1. Depreciation charged on Plant and Machinery ₹ 50,000.
2. Plant and Machinery with a Book Value of ₹ 60,000 was sold for ₹ 40,000.
3. Land was sold at a profit of ₹ 60,000.
4. No investment was sold during the year.

Calculate the result of Cash Flow and state the nature of activity involved in the following transaction :

Sold machinery of original Cost Rs 2,20,000 with an accumulated depreciation of Rs 90,000 fo Rs 70,000.

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(a) Investing Activity: 50,000 (b) Investing Activity: 2,00,000 (c) Investing Activity: 60,000

(a) Investing Activity: 50,000
(b) Investing Activity: 2,00,000
(c) Investing Activity: 60,000