SAMPLE PAPER 1 CASH FLOW STATEMENT

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1 SAMPLE PAPER 1 CASH FLOW STATEMENT Time: 3 hours Maxi Mark 80 General Instructions:- 1. All questions are compulsory. 2. Marks are indicated against the questions. 3. Work should be neat and clean. 4. Overwriting be penalized. Q1. Why cash flow statements are called historical in nature. 1 Q2.State effect of payment of dividend on flow of cash. 1 Q3. Give one example of operation activity for a financial enterprise. 1 Q4. Sale of marketable securities at par would result in inflow, outflow of cash. Give your answer with reason. 1 Q5.When is interest received considered as an investing activity? 1 Q6. Redemption of debentures would result in inflow, outflow or no flow of cash? Give your answer with reason. 1 Q7. Profit made during the year by Bata Ltd. Was 2, 50,000 (after charging deprecation on fixed assets ().state cash flow from operating activities. 1 Q8.In a non- financial enterprise cash receipts from customers is 2, 00,000 and cash paid to suppliers and employees is 1. State the amount of cash flows from operating activity1 Q9. Give the meaning of cash flow statement? 3 Q10. Explain the limitation of cash flow statement? 3 Q11. What are two major inflows and two major outflows of cash from investing activities?3 Q12. Classify the following into cash flows from investing activities/ financing activities while preparing a cash flow statement: 3 (a) Redemption of preference shares (b) Sale of fixed assets (c) Receipt of dividend Q13.Calculate the cash flow from the given information: 4 (i) Investments at the beginning of the period 40,000 (ii) Investments at the end of the period (iii) During the year company had sold 30% of its investments held in the beginning of the period at a profit of 6,000. Q14. Classify the following into operating, investing and financing activities. 4 (a) Issue of Share 2,00,000 (b) Receipt of interest on Investment by a manufacturing Co.

2 (c) Sale of Goods 5,00,000 (d) Receipt of interest on investment by a bank. Q15.classiy following into cash flows from investing activities/financing activities while preparing a cash flow statements: 4 a. Redemption of debentures b. Sale of fixed assets c. Receipt of dividend d. Interest received Q16. Classify the following into cash flows from investing activities/financing activities while preparing cash flow statement: 4 a. Fixed assets purchased b. Dividend Paid c. Interest paid d. Redemption of preference shares Q.17. From the3 following information calculate cash from operating activities: 4 Opening cash balance Closing cash balance Decreasing debtors 5000 Increase in creditors 7000 Net profit of the year Q18. X Ltd. made a profit of 1,00,000 after charging Depreciation of on assets and a transfer to General Reserve of The goodwill written off was 7,000 and the gain on sale of Machinery was 3,000. The other information available to you (changes in the value of Current Assets & Current Liabilities) is as follows: 6 At the end of the year Debtors showed an increase of 6,000, Creditors an increase of Ps, Prepaid Expenses an Increase of 200; Bills Receivable a Decrease of 3000; Bills Payable a Decrease of 4,000 and Outstanding Expenses a Decrease of 2,000. Ascertain the cash flow from the operating activities. Q19. The following balances appeared in Plant Account and Accumulated Depre- ciation Account In the books of Bharat Ltd: 6 Balances as a Plant 7,50,000 9,70,000 Ancumulated Depreciation 1,80,000 2,40,000 Addition Information: Plant costing 1,45000; accumulated depreciation thereon 70,000, was sold for 3. You are required to: a) Compute the amount of Plant purchased, depreciation charged for the year and loss on sale of plant. b) Show how each of the Items related to the plant will be shown in the cash flow statement.

3 Q20.. From the following statement calculate the cash generated from operating activities: 6 Liabilities Assets To Salaries To Rent To Depreciation To Loss on Sale of Building To Goodwill written off To Proposed Dividend To Provision for Tax To Net Profit 1 7, , , 03,000 By Gross Profit By Profit on Sale of Machinery By Dividend Received Q21. From the following balance sheet of Mohan Ltd. Prepare cash flow statement: ,000 6,000 1,03,000 Liabilities Assets Equity share capital Profit & Loss Bank loan Acc. Depreciation Creditor 2,00,000 1,60,000 1,00,000 80,000 1,40,000 3,00,000 2,00,000 80,000 1,00,000 1, Fixed assets Stock Debtors Bills Receivable bank 4,00,000 1, 1,00,000 90,000 6,00,000 1,50,000 60,000 Proposed dividend 60,000 70,000 7,40,000 8,70,000 7,40,000 8,70,000 Q22. Calculate cash Flows from operating activities from the following information: 8 Particulars Debtors Prepaid Expenses Accrued Income Income Received in Advance Creditors Bills payable Outstanding Expenses 42,000 2,000 1, ,000 13,000 8,000 46,000 2,700 1,200 1,000 28,000 11,000 6,000 Profit made during 2004 amounted to 1,00,000 after taking into account the following adjustments:

4 (i) Profit on Sale of Investment (ii) Loss on Sale of Machine (iii) Goodwill Amortized (iv) Depreciation Charged 2, ,000 2,900 Q23. Calculate net-cash flows from operating activities from the following in formation: 8 Profits made during 1996 Transfer to General Reserve Depreciation provided Profit on sale of furniture Loss on sale of machine Preliminary expenses written off 50,000 Additional Information: Debtors Bills Receivable Stock Prepaid Expenses Creditors Bills Payable Outstanding Expenses , ,000 2,000 3,000 18, ,000 4,000

5 SAMPLE PAPER 2 CASH FLOW STATEMENT Time: 3 hours Maxi Mark 80 General Instructions:- 1. All questions are compulsory. 2. Marks are indicated against the questions. 3. Work should be neat and clean. 4. Overwriting be penalized. Q1. Give the two examples of cash equivalents. 1 Q2.What is cash flow statement? 1 Q3.what is meant by extraordinary items? 1 Q4. Mutual Fund Company receives a dividend of 25lakhs on its investments in other company s shares. Why is it a cash inflow from operating activities for this company? 1 Q5. How will you treat bank overdraft in cash flow statement? 1 Q6. Interest received by a finance company is classified under which kind of activity while preparing a cash flow statement? 1 Q7. ABC Ltd. made profit of 2, 60,000 before considering depreciation on machinery and loss on sale of furniture 2. State the amount to be shown as cash flows from operating activities. 1 Q8. DPR Ltd made profit of 2, 50,000 after considering depreciation on fixed assets and profit on sale of building.state the amount to be shown as cash flow from operating activities. 1 Q9. What is meant by the term cash and cash equivalents? 3 Q10.How are the various activities classified according to AS-3(Revised) while preparing the cash flow statement? 3 Q11.PRD Ltd engaged in the business of retailing of two wheelers invested RS. 50,00,000 in the shares of a manufacturing company. State with reason whether the dividend received on this investment will be cash flow from operating activities or investing activities. 3 Q12. (Investing activities) Slim Ltd. provided the following information; 3 a. Machinery was purchased for 60,000 b. A part of machinery, having book value 2,000 was sold for Rs c. An equipment costing has been condemned and scrapped. calculate cash flows from investing activities. Q13. Q.19 From the3 following information calculate cash from operating activities: 4 Opening cash balance Closing cash balance Decreasing debtors Increase in creditors Net profit of the year Q14. Briefly explain the objectives of preparing the cash flow statement. 4 Q15. Give a list of items which result in reduction of cash. 4 Q16. Give the treatment of dividend in case of (a) Financial enterprises and (b) Other than financial enterprises 4

6 Q17. PQR Ltd. Had the following balances 4 Investment at the end of Investment at the end of During the year the company had sold 25% of its investment at the profit of Calculate cash from operating activities and investing activities if the company has earned a profit during the year. Q18. The following balances appeared in Machinery Account and Accumulated Depreciation Account in the books of Jai Bharat Ltd: 6 Balances as at Machinery Account Accumulated Depreciation Account 17,78,985 3,40,795 26,55,450 4,75,690 Additional Information: Machinery costing 2,6 on which accumulated depreciation was 1,00,000, was sold for 7. You are required to: a) Compute the amount of machinery purchased, depreciation charged for the year and loss on sale of machinery. b) How shall each of the items related to machinery be shown in the Cash Flow Statement? Q19. From the following statement calculate the cash generated from operating activities: 6 Statement of profit for the year ending March 31st, 2005 Particulars Particulars To Salaries To Rent To Depreciation To Loss on Sale of Building To Goodwill Written off To Proposed Dividend To Provision for Tax To Net Profit 8,000 1 _24,000 97,000 By Gross Profit By Profit on Sale of Machinery By Dividend Received By Commission Accrued 8 3,000 4,000 97,000

7 Q20. From the following statement, calculate the cash generated from operating activities: Statement of profit for the year ending March 31 st Particulars Amounts Particulars Amounts Salaries Rent Depreciation Loss on sale of Building Goodwill written off Proposed dividend Provision for tax Net profit 8, ,000 Gross profit Profit on sale of Machinery Dividend Received Commission Accrued 8 3,000 4,000 Q21. X Ltd made a profit of 1,00,000 after charging depreciation of on assets and a transfer to General Reserve of. The goodwill written off was 7,000 6 And the gain on sale of Machinery was 3, 000.The other information available to you (change in the value of Current Assets and Current Liabilities) is as follows: At the end of the year, Debtors showed an increase of 6,000 : creditors an increases of ; prepaid expenses an increase of 200; bills payable a decrease of Rs4,000 and outstanding expense a decrease or 2,000. Ascertain the cash flow from the operating activities. Q22. On March 31st, 2003 Ramesh and Co. indicated a profit of 1,2, after considering the following: 8 Depreciation on buildings Depreciation on plant and machinery Amortization of goodwill Gain on sale of machinery 2 4 The current assets and current liabilities at the beginning and the end of the year are: Accounts Receivable Stock on hand Cash in hand , ,000

8 Accounts payable Expenses payable Bank overdraft Ascertain the net cash (cash flow) from operating activities. 60,000 32,000 3 Q23. From following Balance Sheet of Harshit Ltd. And the additional information given, make out a cash Flow Statement: 8 Liabilities Assets Equity share capital Pref. share capital General Reserve Profit and loss A/c Proposed dividend Creditors Bills payable Prov.for taxation 3,00,000 1,50,000 40,000 42, ,000 4,00,000 1,00,000 70,000 48,000 50,000 83,000 16,000 50,000 Goodwill Land and Building Plant Debtors Stock Bills Receivable Cash in hand Cash at Bank 1,1 2,00,000 80,000 1,60,000 77, ,000 1,70,000 2,00,000 2,00,000 1,09,000 8,000 6,77,000 8,17,000 6,77,000 8,17,000 Additional Information Depreciation of and have been charged on plant account and land and building account respectively in An interim dividend of has been paid in Income tax 3 was paid during the year

9 SAMPLE PAPER 3 CASH FLOW STATEMENT Time: 3 hours Maxi Mark 80 General Instructions:- 1. All questions are compulsory. 2. Marks are indicated against the questions. 3. Work should be neat and clean. 4. Overwriting be penalized. Q1.state whether purchase of furniture by issue of debentures will result in inflow, or no flow of cash. 1 Q2.what is meant by extraordinary activities. 1 Q3. What is meant by investing activities? 1 Q4. What is meant by financing activities? 1 Q5.state why non cash transactions are ignored while preparing a cash flow statement? 1 Q6.Under which type of activity will you classify cash received from debtor while preparing cash flow statement? 1 Q7Cash paid as salaries to workers would result in inflow, outflow or no flow of cash? Give your answer with reason. 1 Q8. State with reason whether the issue of 9% debentures to the vendors for the purchase of machinery of 50,000 will result in inflow, outflow or no flow of cash? 1 Q9.what is the preparing objective of cash flow statement. 3 Q10.Classify the following into cash flows from investing activities \financing activities while preparing a cash flow statement; 3 a. Fixed assets purchased b. Dividend paid c. Cash received from issue of equity shares d. Net cash received from sale of investment. Q11.Classify the following into cash flows from investing activities/financing activities while preparing a cash flow statement; 3 (a) Redemption of preference shares (b) Sales of fixed assets (c) Receipt of dividend (d) Interest Received Q12.State two objective of preparing a cash flow statement? 3 Q.13. From the following information calculate cash from investing activities and financing activities: 4 Opening cash balance Closing cash balance Decreasing debtors 8000 Increase in creditors Sale of fixed assets Redemption of debentures Dividend paid 68000

10 Net profit of the year Q14. Explain the main features of cash flow statement. 4 Q15. Fine garments pvt. ltd. provided the following information; 4 a. Machinery was purchased for 1 b. A part of machinery, having book value 4,000 was sold for Rs c. An equipment costing has been condemned and scrapped. calculate cash flows from investing activities. Q16. Classify with reasons the following into cash flows from investing activities/ financing activities while preparing a cash flow statement: 4 (a) Long term borrowings (b) Sale of fixed assets (c) Profit on sale of fixed assets (d) Loss on sale of fixed assets Q17. Explin briefly managerial uses of statement of changes in financial position on cash basis. 4 Q18. From the following summarised Balance Sheets of a company calculate cash flow from operating activities 6 Liabilities Assets 2004 Rs 2005 Creditors Bills Payable Other Current Liabilities Share Capita; Profit & Loss A/c 50,000 1,00,000 _80,000 2,90, , 1,00,000 3,4 Cash Investments Stock Debtors Fixed Assets 50,000 40,000 40,000 1, 2,90,000 40,000 40, ,000 1,60,000 3,4 Q19. The following balances appeared in Plant Account and Accumulated Depreciation Account in the Books of Bharat Ltd. 6 Balances as at Plant 7, 50,000 9, 70,000 Accumulated depreciation 1, 80,000 2, 40,000 Additional Information Plant costing 1,4 : accumulated depreciation thereon 70,000, was sold for 3. You are required to Compute the amount plant purchased, depreciation charged for the year and loss on sale of plant Show how each of the item related to the plant will be shown in the cash flow statement

11 Q20. Prepare cash flow statement of Rose Ltd from the following information for the year ended March 31, Particulars Investment Fixed Assets(at cost) Equity share capital Long term loan Cash 1,80,000 2, 10,00,000 8,00,000 64,000 2,40,000 4,00,000 14,00,000 4,4 44,000 Additional Information Cash flow from the operating activities after tax and extraordinary items 3,80,000 Depreciation on fixed assets 8 Interest received 4 Dividend paid during the year 1,60,000 Q21. The following is the position of current assets and current liabilities of vijay Ltd. 6 Particulars Creditors Debtors Bills receivables Prepaid insurance The company incurred a loss of 6000 during the year. Calculate cash from operating activities. Q22. Raj Ltd. had a profit of 17,50,000 for the year ended after considering the following : 8 1, Depreciation on building Depreciation on plant and machinery 40,000 Goodwill written off 2 Loss on sale of machinery 9,000

12 Following was the position of current assets and current liabilities of the company as on and Stock 70,000 87,000 Bills Receivable 67,000 58,000 Cash 60,000 7 Creditors 68,000 77,000 Outstanding Salary 7,000 4,000 Bills Payable 43,000 29,000 Calculate cash flow from operating activities. Q23. With the help of the following Profit and Loss Account for the year ended and Balance Sheets as on and of Janta Ltd., calculate cash flow from operating activities : 8 Debit Profit and Loss Account of Janta Ltd. for the year ended Credit Particulars Amount Particulars Amount Depreciation 0 Salary Rent Commission Other Expenses Net Profit 17, ,000 23,000 3, Gross Profit 5,00,000 5,00,000 5,00,000 Proposed Dividend 1,50,000 Net Profit 3, Retained Profit 1,60,000 3, 3, Balance Sheets of Janta Ltd. as on and Liabilities Assets Share Capital 2,00,000 3,50,000

13 Reserves 60,000 2, Loan Patents 50,000 Proposed Dividend 1,70,000 Stock 1,0 1, Creditors 1,80,000 Debtors 70,000 90,000 Bills Payable 1,70,000 6,50,000 8,00,000 6,50,000 8,00,000

14 QUESTION BANK CASH FLOW STATEMENT ONE MARKS QUESTIONS Q1.state whether purchase of furniture by issue of debentures will result in inflow, or no flow of cash. Q2.what is meant by extraordinary activities. Q3. What is meant by investing activities? Q4. What is meant by financing activities? Q5.state why non cash transactions are ignored while preparing a cash flow statement? Q6.Under which type of activity will you classify cash received from debtor while preparing cash flow statement? Q7Cash paid as salaries to workers would result in inflow, outflow or no flow of cash? Give your answer with reason. Q8. State with reason whether the issue of 9% debentures to the vendors for the purchase of machinery of 50,000 will result in inflow, outflow or no flow of cash? Q9. Give the two examples of cash equivalents. Q10.What is cash flow statement? Q11.what is meant by extraordinary items? Q12. Mutual Fund Company receives a dividend of 25lakhs on its investments in other company s shares. Why is it a cash inflow from operating activities for this company? Q13. How will you treat bank overdraft in cash flow statement? Q14. Interest received by a finance company is classified under which kind of activity while preparing a cash flow statement? Q15. ABC Ltd. made profit of 2, 60,000 before considering depreciation on machinery and loss on sale of furniture 2. State the amount to be shown as cash flows from operating activities. Q16. DPR Ltd made profit of 2, 50,000 after considering depreciation on fixed assets and profit on sale of building.state the amount to be shown as cash flow from operating activities. Q17. Why cash flow statements are called historical in nature. Q18.State effect of payment of dividend on flow of cash.

15 Q19. Give one example of operation activity for a financial enterprise. Q20. Sale of marketable securities at par would result in inflow, outflow of cash. Give your answer with reason. Q21.When is interest received considered as an investing activity? Q22. Redemption of debentures would result in inflow, outflow or no flow of cash? Give your answer with reason. Q23. Profit made during the year by Bata Ltd. Was 2, 50,000 (after charging deprecation on fixed assets ().state cash flow from operating activities. Q24.In a non- financial enterprise cash receipts from customers is 2, 00,000 and cash paid to suppliers and employees is 1. State the amount of cash flows from operating activity. THREE AND FOUR MARKS QUESTIONS Q1. What is meant by the term cash and cash equivalents? Q2.How are the various activities classified according to AS-3(Revised) while preparing the cash flow statement? Q3.PRD Ltd engaged in the business of retailing of two wheelers invested RS. 50,00,000 in the shares of a manufacturing company. State with reason whether the dividend received on this investment will be cash flow from operating activities or investing activities. Q4. (Investing activities) Slim Ltd. provided the following information; a. Machinery was purchased for 60,000 b. A part of machinery, having book value 2,000 was sold for Rs c. An equipment costing has been condemned and scrapped. calculate cash flows from investing activities. Q5. From the3 following information calculate cash from operating activities: Opening cash balance Closing cash balance Decreasing debtors Increase in creditors Net profit of the year 40000

16 Q6. Briefly explain the objectives of preparing the cash flow statement. Q7. Give a list of items which result in reduction of cash. Q8. Give the treatment of dividend in case of (a) Financial enterprises and (b) Other than financial enterprises Q9. PQR Ltd. Had the following balances Investment at the end of Investment at the end of During the year the company had sold 25% of its investment at the profit of Calculate cash from operating activities and investing activities if the company has earned a profit during the year. Q10.what is the preparing objective of cash flow statement. Q11.Classify the following into cash flows from investing activities \financing activities while preparing a cash flow statement; a. Fixed assets purchased b. Dividend paid c. Cash received from issue of equity shares d. Net cash received from sale of investment. Q12.Classify the following into cash flows from investing activities/financing activities while preparing a cash flow statement; (e) Redemption of preference shares (f) Sales of fixed assets (g) Receipt of dividend (h) Interest Received Q13.State two objective of preparing a cash flow statement? Q.14. From the following information calculate cash from investing activities and financing activities: Opening cash balance Closing cash balance Decreasing debtors 8000 Increase in creditors Sale of fixed assets Redemption of debentures 22000

17 Dividend paid Net profit of the year Q15. Explain the main features of cash flow statement. Q16. Fine garments pvt. ltd. provided the following information; a. Machinery was purchased for 1 b. A part of machinery, having book value 4,000 was sold for Rs c. An equipment costing has been condemned and scrapped. calculate cash flows from investing activities. Q17. Classify with reasons the following into cash flows from investing activities/ financing activities while preparing a cash flow statement: (e) Long term borrowings (f) Sale of fixed assets (g) Profit on sale of fixed assets (h) Loss on sale of fixed assets Q18. Explin briefly managerial uses of statement of changes in financial position on cash basis. Q19. Give the meaning of cash flow statement? Q20. Explain the limitation of cash flow statement? Q21. What are two major inflows and two major outflows of cash from investing activities? Q22. Classify the following into cash flows from investing activities/ financing activities while preparing a cash flow statement: (d) Redemption of preference shares (e) Sale of fixed assets (f) Receipt of dividend Q23.Calculate the cash flow from the given information: (i) Investments at the beginning of the period 40,000 (ii) Investments at the end of the period (iii) During the year company had sold 30% of its investments held in the beginning of the period at a profit of 6,000.

18 Q24. Classify the following into operating, investing and financing activities. (a) Issue of Share 2,00,000 (b) Receipt of interest on Investment by a manufacturing Co. (c) Sale of Goods 5,00,000 (d) Receipt of interest on investment by a bank. Q25.classiy following into cash flows from investing activities/financing activities while preparing a cash flow statements: e. Redemption of debentures f. Sale of fixed assets g. Receipt of dividend h. Interest received Q26. Classify the following into cash flows from investing activities/financing activities while preparing cash flow statement: e. Fixed assets purchased f. Dividend Paid g. Interest paid h. Redemption of preference shares Q.27. From the3 following information calculate cash from operating activities: Opening cash balance Closing cash balance Decreasing debtors 5000 Increase in creditors 7000 Net profit of the year 20000

19 SIX AND EIGHT MARKS QUESTIONS Q1. From the following summarised Balance Sheets of a company calculate cash flow from operating activities Liabilities Assets 2004 Rs 2005 Creditors 3 Cash 40,000 Bills Payable 3 Investments 50,000 40,000 Other Current 50,000 5 Stock 40,000 5 Liabilities 1,00,000 1, Debtors 40,000 50,000 Share Capita; _80,000 1,00,000 Fixed Assets 1, 1,60,000 Profit & Loss A/c 2,90,000 3,4 2,90,000 3,4 Q2. The following balances appeared in Plant Account and Accumulated Depreciation Account in the Books of Bharat Ltd. Balances as at Plant 7, 50,000 9, 70,000 Accumulated depreciation 1, 80,000 2, 40,000 Additional Information Plant costing 1,4 : accumulated depreciation thereon 70,000, was sold for 3. You are required to Compute the amount plant purchased, depreciation charged for the year and loss on sale of plant Show how each of the item related to the plant will be shown in the cash flow statement

20 Q3. Prepare cash flow statement of Rose Ltd from the following information for the year ended March 31, 2008 Particulars Investment Fixed Assets(at cost) Equity share capital Long term loan Cash 1,80,000 2, 10,00,000 8,00,000 64,000 2,40,000 4,00,000 14,00,000 4,4 44,000 Additional Information Cash flow from the operating activities after tax and extraordinary items 3,80,000 Depreciation on fixed assets 8 Interest received 4 Dividend paid during the year 1,60,000 Q4. The following is the position of current assets and current liabilities of vijay Ltd. Particulars Creditors Debtors Bills receivables Prepaid insurance The company incurred a loss of 6000 during the year. Calculate cash from operating activities. Q5. Raj Ltd. had a profit of 17,50,000 for the year ended after considering the following : Depreciation on building 1, Depreciation on plant and machinery 40,000 Goodwill written off 2 Loss on sale of machinery 9,000

21 Following was the position of current assets and current liabilities of the company as on and Stock 70,000 87,000 Bills Receivable 67,000 58,000 Cash 60,000 7 Creditors 68,000 77,000 Outstanding Salary 7,000 4,000 Bills Payable 43,000 29,000 Calculate cash flow from operating activities. Q6. With the help of the following Profit and Loss Account for the year ended and Balance Sheets as on and of Janta Ltd., calculate cash flow from operating activities : Profit and Loss Account of Janta Ltd. for the year ended Debit Credit Particulars Amount Particulars Amount Gross Profit 5,00,000 Depreciation 0 Salary Rent Commission Other Expenses 17, ,000 23,000 3,

22 Net Profit 5,00,000 5,00,000 Proposed Dividend 1,50,000 Net Profit 3, Retained Profit 1,60,000 3, 3, Balance Sheets of Janta Ltd. as on and Liabilities Assets Share Capital 2,00,000 3,50,000 Reserves 60,000 2, Loan Patents 50,000 Proposed Dividend 1,70,000 Stock 1,0 1, Creditors 1,80,000 Debtors 70,000 90,000 Bills Payable 1,70,000 6,50,000 8,00,000 6,50,000 8,00,000 Q7. The following balances appeared in Machinery Account and Accumulated Depreciation Account in the books of Jai Bharat Ltd: Balances as at Machinery Account Accumulated Depreciation Account 17,78,985 3,40,795 26,55,450 4,75,690 Additional Information: Machinery costing 2,6 on which accumulated depreciation was 1,00,000, was sold

23 for 7. You are required to: a) Compute the amount of machinery purchased, depreciation charged for the year and loss on sale of machinery. b) How shall each of the items related to machinery be shown in the Cash Flow Statement? Q8. From the following statement calculate the cash generated from operating activities: Statement of profit for the year ending March 31st, 2005 Particulars Particulars To Salaries By Gross Profit 8 To Rent By Profit on Sale of To Depreciation Machinery 3,000 To Loss on Sale of By Dividend Received 4,000 Building 8,000 By Commission Accrued To Goodwill Written off To Proposed Dividend 1 To Provision for Tax _24,000 To Net Profit 97,000 97,000 Q9. From the following statement, calculate the cash generated from operating activities: Statement of profit for the year ending March 31 st 2007 Particulars Amounts Particulars Amounts Salaries Rent Depreciation Loss on sale of Building Goodwill written off Proposed dividend Provision for tax Net profit 8, ,000 Gross profit Profit on sale of Machinery Dividend Received Commission Accrued 8 3,000 4,000

24 Q10. X Ltd made a profit of 1,00,000 after charging depreciation of on assets and a transfer to General Reserve of. The goodwill written off was 7,000 And the gain on sale of Machinery was 3, 000.The other information available to you (change in the value of Current Assets and Current Liabilities) is as follows: At the end of the year, Debtors showed an increase of 6,000 : creditors an increases of ; prepaid expenses an increase of 200; bills payable a decrease of Rs4,000 and outstanding expense a decrease or 2,000. Ascertain the cash flow from the operating activities. Q11. On March 31st, 2003 Ramesh and Co. indicated a profit of 1,2, after considering the following: Depreciation on buildings Depreciation on plant and machinery Amortization of goodwill Gain on sale of machinery 2 4 The current assets and current liabilities at the beginning and the end of the year are: Accounts Receivable Stock on hand Cash in hand Accounts payable Expenses payable Bank overdraft ,000 60, ,000 32,000 3 Ascertain the net cash (cash flow) from operating activities.

25 Q12. From following Balance Sheet of Harshit Ltd. And the additional information given, make out a cash Flow Statement: Liabilities Assets Equity share capital Pref. share capital General Reserve Profit and loss A/c Proposed dividend Creditors Bills payable Prov.for taxation 3,00,000 1,50,000 40,000 42, ,000 4,00,000 1,00,000 70,000 48,000 50,000 83,000 16,000 50,000 Goodwill Land and Building Plant Debtors Stock Bills Receivable Cash in hand Cash at Bank 1,1 2,00,000 80,000 1,60,000 77, ,000 1,70,000 2,00,000 2,00,000 1,09,000 8,000 6,77,000 8,17,000 6,77,000 8,17,000 Additional Information Depreciation of and have been charged on plant account and land and building account respectively in An interim dividend of has been paid in Income tax 3 was paid during the year Q13. XYZ Ltd. made a profit of 2,00,000 after charging Depreciation of 40,000 on assets and a transfer to General Reserve of 60,000 The goodwill written off was 14,000 and the gain on sale of Machinery was 6,000. The other information available to you (changes in the value of Current Assets & Current Liabilities) is as follows: At the end of the year Debtors showed an increase of 12,000, Creditors an increase of Ps, Prepaid Expenses an Increase of 400; Bills Receivable a Decrease of 5000; Bills Payable a Decrease of 8,000 and Outstanding Expenses a Decrease of 4,000. Ascertain the cash flow from the operating activities. Q14. The following balances appeared in Plant Account and Accumulated Depre- ciation Account In the books of Bharat Ltd: Balances as a

26 Plant 7,50,000 9,70,000 Ancumulated Depreciation 1,80,000 2,40,000 Addition Information: Plant costing 1,45000; accumulated depreciation thereon 70,000, was sold for 3. You are required to: a) Compute the amount of Plant purchased, depreciation charged for the year and loss on sale of plant. b) Show how each of the Items related to the plant will be shown in the cash flow statement. Q15.. From the following statement calculate the cash generated from operating activities: Liabilities Assets To Salaries 1 By Gross Profit 8 To Rent 7,000 By Profit on Sale of 12,000 To Depreciation 2 Machinery 6,000 To Loss on Sale of 6,000 By Dividend Building Received To Goodwill written off To Proposed Dividend To Provision for Tax To Net Profit 2 1, 03,000 1,03,000

27 Q16. From the following balance sheet of Mohan Ltd. Prepare cash flow statement: Liabilities Assets Equity share capital Profit & Loss Bank loan Acc. Depreciation Creditor 2,00,000 1,60,000 1,00,000 80,000 1,40,000 3,00,000 2,00,000 80,000 1,00,000 1, Fixed assets Stock Debtors Bills Receivable bank 4,00,000 1, 1,00,000 90,000 6,00,000 1,50,000 60,000 Proposed dividend 60,000 70,000 7,40,000 8,70,000 7,40,000 8,70,000 Q17. Calculate cash Flows from operating activities from the following information: Particulars Debtors Prepaid Expenses Accrued Income Income Received in Advance Creditors Bills payable Outstanding Expenses 42,000 2,000 1, ,000 13,000 8,000 46,000 2,700 1,200 1,000 28,000 11,000 6,000 Profit made during 2004 amounted to 1,00,000 after taking into account the following adjustments: (i) Profit on Sale of Investment (ii) Loss on Sale of Machine (iii) Goodwill Amortized (iv) Depreciation Charged 2, ,000 2,900

28 Q18. Calculate net-cash flows from operating activities from the following in formation: Profits made during 1996 Transfer to General Reserve Depreciation provided Profit on sale of furniture Loss on sale of machine Preliminary expenses written off 50,000 Additional Information: Debtors Bills Receivable Stock Prepaid Expenses Creditors Bills Payable Outstanding Expenses 7, , , ,000 3,000 18, ,000