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Question -

From the following Balance Sheet of Mohan Ltd., prepare cash flow Statement:

Balance Sheet of Mohan Ltd.,
as at 31st March 2016 and 31 March 2017

Particulars

Note No.

March 31, 2017
(₹)

March 31, 2016
(₹)

I) Equity and Liabilities

1. Shareholders’ Funds

a) Equity share capital

3,00,000

2,00,000

b) Reserves and surplus

2,00,000

1,60,000

2. Non-current liabilities

a) Long-term borrowings

1

 80,000

1,00,000

3. Current liabilities

Trade payables

1,20,000

1,40,000

Short-term provisions

2

70,000

60,000

Total

7,70,000

6,60,000

II) Assets

1. Non-current assets

Fixed assets

3

5,00,000

3,20,000

2. Current assets

a) Inventories

1,50,000

1,30,000

b) Trade receivables

4

90,000

1,20,000

c) Cash and cash equivalents

5

30,000

90,000

Total

 7,70,000

6,60,000

Notes to accounts:

2017

2016

1. Long-term borrowings

Bank Loan

80,000

1,00,000

2. Short-term provision

Proposed dividend

70,000

60,000

3. Fixed assets

6,00,000

4,00,000

Less: Accumulated Depreciation

1,00,000

80,000

(Net) Fixed Assets

5,00,000

3,20,000

4. Trade receivables

Debtors

60,000

1,00,000

Bills receivables

30,000

20,000

90,000

1,20,000

5. Cash and cash equivalents

Bank

30,000

90,000

Additional Information:
Machine Costing ₹. 80,000 on which accumulated depreciation was ₹. 50,000 was sold for ₹. 20,000.



Answer -


Cash Flow Statement of Mohan Ltd.

Particulars

Amount

Amount

A.

Cash Flow from Operating Activities

Profit as per the Balance Sheet  (2,00,000 – 1,60,000)

40,000

Proposed Dividend

70,000

Net Profit before Taxation and Extraordinary items

1,10,000

Adjustments:

Depreciation

70,000

Loss on Sale of Machine

10,000

80,000

Operating Profit before Working Capital changes

1,90,000

Add:

Decrease in Current Assets

Debtors

40,000

40,000

2,30,000

Less:

Increase in Current Assets

Inventories

(20,000)

Bills Receivable

(10,000)

Less:

Decrease in Current Liabilities

Trade Payables

(20,000)

(50,000)

Net Cash from Operations

1,80,000

B.

Cash Flow from Investing Activities

Proceeds from Sale of Fixed Assets

20,000

Purchases of Fixed Assets

(2,80,000)

Net Cash outflow from Investing activity

(2,60,000)

C.

Cash Flow from Financing Activities

Issue of Shares

1,00,000

Bank Loan Paid

(20,000)

Dividend Paid

(60,000)

Net Cash from Financing Activities

20,000

D.

Net Decrease in Cash and Cash Equivalents (A+B+C)

(60,000)

Add:

Cash and Cash Equivalents in the beginning

90,000

E.

Cash and Cash equivalents at the end

30,000

Fixed Assets Account

Dr.

Cr.

Date

Particulars

J.F.

Amount

Date

Particulars

J.F.

Amount

Balance b/d

4,00,000

Bank

20,000

Bank (Purchases- Balancing fig.)

2,80,000

Profit and Loss

10,000

Accumulated Depreciation

50,000

Balance c/d

6,00,000

6,80,000

6,80,000

 

Accumulated Depreciation Account

Dr.

Cr.

Date

Particulars

J.F.

Amount

Date

Particulars

J.F.

Amount

Fixed Assets

50,000

Balance b/d

80,000

Balance c/d

1,00,000

Profit and Loss (Balance fig.)

70,000

1,50,000

1,50,000

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