Question

Welprint Ltd. has given you the following information:

Machinery as on April 01, 2012 : Rs.50,000

Machinery as on March 31, 2013 : Rs.60,000

Accumulated Depreciation on April 01, 2012 : Rs.25,000

Accumulated Depreciation on March 31, 2013 : Rs.15,000

During the year, a Machine costing Rs 25,000 with Accumulated Depreciation of Rs. 15,000 was sold for Rs. 13,000.

Calculate cash flow from Investing Activities on the basis of the above information.

• A. Rs. 10,400
• B. Rs. 10,000
• C. Rs. 22,000
• D. Rs. 17,200

Answer 1

The correct option is C

Rs. 22,000

Cash Flow from Investing Activities = Rs. 22,000

$\begin{array}{cc}\text{Cash Flows from Investing Activities}& \text{(Rs.)}\\ \text{Sale of Machinery}& 13,000\\ \text{Purchase of Machinery}& (35,000)\\ \text{Net cash used in Investing Activities}& \overline{\underset{–}{\underset{–}{(22,000)}}}\end{array}$