Question

late cash from operating activity
Debtors 42000, 46000
pre-paid expense 2000 ,2700
Accrued income 1500, 1200
B/R 14000,12000
income received in advance 800,1000
B/P 13000,11000
Creditors 26000,28000
O/S expense 8000, 6000
Profit earned during second year 100000.The adjustments are
a) profit on sale of investment 2000
b) loss on sale of machine 900
c)G/W amortised 3000
d)Depreciation charged 2900
Ans- 100600

Answer 1

Hi Lakshmi

The solution to your query is provided below:

		Cash Flow Statement
	Particulars			Amount (Rs)	Amount (Rs)
A	Cash Flow from Operating Activities
	Profit earned during the year			1,00,000
	Profit Before Taxation			1,00,000
	Items to be Added:
	Loss on sale of Machinery			900
	Goodwill Amortised			3,000
	Depreciation Charged			2,900
	Items to be Subtracted:
	Profit on sale of investment			2,000
	Operating Profit before Working Capital Adjustments			1,04,800
	Less: ­Increase in Current Assets and Decrease in Current Liabilities
			Debtors	4,000
			Pre-paid Expense	700
			Bills Payable	2,000
			Outstanding Expense	2,000
	Add: Decrease in Current Assets and Increase­ in Current Liabilities
	Accrued Income			300
	Bills Receivable			2,000
	Income received in advance			200
	Creditors			2,000
	Cash Generated from Operations			1,00,600
	Net Cash Flows from Operating Activities				1,00,600