Following balances are provided by Nakul Ltd. for the year ended on 31 st March, 2018 and on 31 st March, 2019: Particulars 31 st March, 2018 31 st March, 2019 Equity Share Capital 500 560 General Reserves 310 365 Surplu
CS Executive · Corporate and Management Accounting · PYQS · June 2019
Following balances are provided by Nakul Ltd. for the year ended on 31 st March, 2018 and on 31 st March, 2019: Particulars 31 st March, 2018 31 st March, 2019 Equity Share Capital 500 560 General Reserves 310 365 Surplus 165 222 8% Debentures 350 200 Goodwill 60 47 Land & Building 430 387 Plant & Machinery 300 330 Investment (Trading) 48 53 Trade Payables 105 122 Provision for tax 78 98 Outstanding Expenses 18 13 Inventories 165 153 Trade Receivables 171 206 Cash at Bank 52 63 Prepaid Expenses 7 5 Additional Information: (1) During the year, an old machine costing ₹ 45 lakh was sold for ₹ 21 lakh. It's written down value was ₹ 29 lakh. (2) Depreciation charged on plant and machinery @ 15% on the opening balance. (3) There were no purchases or sales of land and building during the year. (4) Provision for tax made during the year was ₹ 96 lakh. (5) During the year, premium on redemption of debentures was written-off as ₹ 15 lakh. From the above mentioned information, you are required to prepare a Statement showing the Net Cash Flow from the Operating Activities.
Answer & Explanation:
Statement showing Net cash outflow from Operating activities for the year ending 31 st March, 2019 (Rs in lakh) Particulars Rs. Surplus as on 31-3-19 222 Less: surplus as on 31-3-18 (165) Add: Transfer to General Reserves (365-310) 55 Add: provision for tax made during the year 96 Profit before taxes and extraordinary items 208 Adjustment for Non-cash and Non-operating items: Land and Building Depreciation (430 - 387) 43 Plant and Machinery Depreciation (15% of ₹ 300) 45 Loss on sale of Plant and machinery (WDV 29 - Sale Price 21) 8 Goodwill written off (60 - 47) 13 Premium on redemption of debenture written off 15 Operating profit before working capital changes 332 Working capital changes: Increase in Investment (Trading) (53-48) (5) Decrease in prepaid expenses (7-5) 2 Decrease in inventory (165-153) 12 Increase in trade receivables (206-171) (35) Increase in trade payables (122-105) 17 Decrease in outstanding expenses (18-13) (5) Cash generated from outstanding operations 318 Income tax paid (Provision for tax a/c: Opening 78 + Made 96 - Closing 98 = Paid 76) (76) Net cash inflow from operating activities 242 Working notes: Provision for tax a/c (Rs in lakh) Particulars Rs. Particulars Rs. To bank a/c (bal fig) 76 By balance b/d 78 To balance c/d 98 By profit ad loss a/c 96 174 174
Topics: Cash Flow Statement
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