1.

From the following balance sheet of Tarun Fashion Ltd, prepare a Cash Flow Statement

Particulars Note No. 31.03.2018 31.03.2017

Equity & Liabilities
1. Shareholder funds
a. Share Capital 150000 120000
b. Reserves & Surplus 178000 75000
2. Non-Current Liabilities
a. Long -term borrowings 1 - 50000
3. Current Liabilities
a. Trade Payable 31500 67000
b. Short term Provisions 42000 30000
401500 342000
Assets
1. Properties, Plants & Intangible Assets
a. Tangible Assets 2 208000 140000
b. Intangible Assets 3 35000 20000
2. Current Assets
a. Inventories 105000 120000
b. Trade Recievables 33500 37000
c. Cash & Cash Equivalents 20000 25000
401500 342000

Note to Accounts
Particulars 31.03.2018 31.03.2017
Long-term Borrowings ( 15% Debentures) - 50000
Tangible Assets
Building 80000 100000
Plant & Machinery 128000 40000
208000 140000
Intangible Assets (Goodwill) 35000 20000

Additional Information:
1. Proposed Dividend on 31st March 2018 15000 and on 31st March 2017 12000.
2. Depreciation of 10000 was provided on Plant & Machinery.
3. Gain on sale of part of Building 25000.
4. Debentures were redeemed on 01st April 2017.

Solution.
Cash Flow Statement
for the year ended 31st March 2018
Particulars Details Amount
A. Cash Flow from operating activities
Net profit before tax 165000
Add:
Depreciation on Plant & Machinery 10000
Less :
Gain on sale of Building -25000 -15000
Operating profit before working capital changes 150000
Add: Decrease in current assets
Trade receivables 3500
Inventories 15000 18500
 168500
Less : Decrease in current liablities
Trade payables -35500 -35500
133000
Less : Income Tax -38000
Net Cash Flow from operating activiites 95000

B. Cash flow from investing activities

Purchase of Goodwill -15000
Sale of Building 45000
Purchase of Plant and Machinery -98000
Net Cash used in Investing Activities -68000
C. Cash Flow from Financing Activities
Issue of Share capital 30000
Redemption of Debenture ( -50000
Payment of Dividend -12000
Net Cash used in Financing Activities -32000
Net decrease in cash -5000
Add : Cash at beginning 25000
Cash and Cash equivalents at end 20000

Building Account
Particulars Amount Particulars Amount
To Balance B/d 100000 By Bank A/c 45000
To Bank A/c ( Purchase) 25000 By Balance C/d 80000
125000 125000

Plant and Machinery

Particulars Amount Particulars Amount
To Balance B/d 40000 By Depreciation 10000
To Bank A/c ( Purchase) 98000 By Balance C/d 128000
138000 138000

Calculation of Net profit before tax

Surplus (i.e. statement of balance P&L) 103000
(178000-75000)
Add :
Proposed dividend of Prev year 12000
Provision for Tax made during the year 50000
165000
2. Prepare a Cash Flow Statement from the following Balance Sheet of Dry Fruits Ltd:-

Particulars Note No. 31.03.2018 31.03.2017

I.EQUITY AND LIABILITIES
(1) Shareholder’s Fund
(a) Share Capital 2,00,000 2,00,000
(b)Reserve and Surplus 1 84,000 (8,000)
(2) Non-current Liabilities:
Long term Borrowings 2 1,35,000 1,00,000
(3) Current Liabilities:
Trade Payables 68,000 62,000
Total 4,87,000 3,54,000
II. ASSETS :
(1) Non-Current Assets:
Fixed Assets 3 1,20,000 1,30,000
(2) Current Assets:
(a) Current Investments (Marketable Sec.) 22,000 15,000
(b) Inventories 61,000 80,000
(c) Trade Receivables 40,000 29,000
(d) Cash & Cash Equivalents 2,44,000 1,00,000

Total 4,87,000 3,54,000

Note :-
31.03.2018 31.03.2017
(1) Long term Borrowing :
General Reserve 24000 -
Profit & Loss Balance 60000 (8000)
84000 (8000)
(2) Long-term Borrowings :
12 % Mortgage Loan 135000 100000
(3) Fixed Assets :
Machinery 145000 160000
Less : Accumulated Depreciation 25000 30000
120000 130000
Additional Information:
(i) Interest paid on mortgage loan amounted to 14100.
(ii) Interim Dividend paid during the year 20000.
(iii)Machinery costing 40000 (accumulated depreciation thereon being 18000) was sold for 5000.

Solution :-

Particulars Details Amount

A. Cash Flow from operating activities
Net profit before tax 112000
Adjustments for non-cash and non-operating items:
Add:
Interest paid on mortgage loan 14100
Loss on sale of machinery 17000
Depreciation 13000 44100
Operating profit before working capital changes 156100
Add : Decrease in Current Assets
Inventory 19000
Add: Increase in Current Liabilities:
Trade Payables 6000 25000
181100
Less: Increase in Current Assets:
Trade Receivables -11000 -11000
Net Cash from Operating Activities 170100
B. Cash Flow from Investing Activities
Purchase of Machinery -25000
Sale of Building 5000 -20000
Net Cash from Investing Activities -20000
C. Cash Flow from Fianncing Activities
Proceeds of 12% mortgage loan 35000
Interest paid on mortgage loan -14100
Interim Dividend paid -20000 900
Net Cash from Financing Activities 900
Net Decrease in Cash and Cash equivalents 170100+ (20000)+
9000 151000
Add : Cash and Cash Equivalents in the beginning of the period 115000
Cash and Cash equivalents at the end of the period 266000

Machinery Account
Particulars Amount Particulars Amount
To Balance B/d 160000 By Bank A/c (sale) 5000
To Bank A/c ( B/f)) 25000 By Accumulated Dep. A/c 18000
BY Statement of P&L A/c 17000
By Balance c/d 145000
185000 185000

Calculation of Net profit before tax

Profit and loss Balance on 31st March 2018 60000
Less: Profit & Loss Balance 31st March, 2017 -8000
68000
Add :
Transfer to General Reserve 24000
Interim Dividend paid 20000
Net Profit before Tax 112000
3. Following is the balance sheet of Wish Ltd as on 31st March, 2022:-

Particulars Note No. 31-3-22(₹} 31-3-21(₹}

1.Equity and Liabilities

1. Shareholders funds:-
a) Share Capital 7,00,000 6,00,000
b) Reserves and Surplus 1 2,00,000 1,10,000
2. Non current liabilities
LTB 3,00,000 2,00,000
3. Current Liabilities
Trade Payables 30,000 25,000
Total 12,30,000 9,35,000
Assets:-
1.Properties, plants and equipments and intangible
assets 11,00,000 8,00,000
2. Current Assets
a) Inventories 70,000 60,000
b) Trade Receivables 32,000 40,000
c) Cash and cash Equivalents 28,000 35,000
Total 12,30,000 9,35,000

Notes to Accounts:-

Particulars 31-3-22 ₹ 31-3-21 ₹

1. Reserves and Surplus
Surplus i.e Balance in statements of P/L 2,00,000 1,10,000

Additional Information:-

During the year, a piece of machinery of the book value of ₹ 80,000 was sold for ₹ 65,000.
Depreciation provided on tangible asset during the year was ₹ 2,00,000. Prepare CFS.

Wish Ltd CFS

(For the year ended March 31st,2022)

Particulars Amt. ₹
1. Cash flow from operating activities:-
Surplus I.e bal. in statements of P/L (2,00,000- 1,10,000) 90,000
Net Profit before tax and extra ordinary items 90,000
Add:-
Depreciation 2,00,000
 Loss on sale of machinery (80,000- 65,000) 15,000
Operating Profits before W.C changes 3,05,000
Add:- Decrease in T/R 8,000
Add:- Increase in T/P 5,000
Less:- Increase in inventorties (10,000)
Net Cash flow from operating activities 3,08,000
2. Cash flow from Investing Activities:-
Purchase of Tangible assets (note no. 1) (5,80,000)
Proceeds from sale of machinery 65,000
Net Cash used in Investing activities (5,15,000)
3. Cash flow from financing activities:-
Issue of Shares 1,00,000
Cash proceeds from LTB 1,00,000
Net Cash flow from financing activities 2,00,000
Net decrease in Cash (7,000)
Add:- Cash and cash equivalents at beg. 35,000
Cash and cash equivalents at end
28,000

Machinery
Account

Particulars Amt. Particulars Amt.

To bal. b/d 8,00,000 By Depreciation a/c 2,00,000
To bank a/c (Purchase) 5,80,000 By Bank a/c (Sales) 65,000
By P/L (loss on sales) 15,000
By bal. c/d 11,00,000
13,80,000 13,80,000

4. Prepare Cash Flow Statement(as per AS-3 (Revised)) for the year ended 31st March, 2020 from the
following Balance Sheet as at 31st March 2020:

Super India Ltd.

Balance Sheet as at 31st March, 2020
Note
Particulars No. 31.03.2020 31.03.2019
Equity & Liabilities
1. Shareholder funds
a. Share Capital( Equity Share Capital) 600000 400000
b. Reserves & Surplus (Statement of Profit and Loss) 200000 100000
2. Non-Current Liabilities
a. Long -term borrowings 100000 200000
3. Current Liabilities
a. Short term Provisions - 10000
 b.Trade Payables (Creditors) 45000 60000
c. Short Term Provisions 1 70000 40000
Total 1015000 810000

Assets
1. Non- Current Assets
(a) Fixed Assets :
(i) Tangible (Building) 600000 600000
(ii) Intangible (Patents) 45000 50000
(b) Non- Current Investements 75000 -
2. Current Assets
(a) Inventories 15000 10000
(b) Trade Receivables (Debtors) 195000 120000
© Cash and Cash Equivalents (Cash) 85000 30000
Total 1015000 810000

Note to Accounts
Particulars 31.03.2020 31.03.2019
1. Short-term Provisions
Provision for tax 70000 40000
st
Note : Dividend proposed for the years ended 31 March 2019 and 2020 are 60000 and 80000
respectively.
Additional Information:
(i) Building was purchased for 75000
(ii) An old building, the book value of which was 63000, was sold at a loss of 5000.
(iii) Tax provided during the year was 80000.

Solution:-

Super India Ltd.

Cash Flow Statement for the year ended 31st March 2020
Particulars Details Amount
A. Cash Flow from operating activities
Net profit before tax and Extraordinary items:
Closing Balance of Surplus, i.e. Balance in Statement of Profit and Loss 200000
Less : Opening Balance of Surplus, i.e. Balance in Statement of Profit and Loss 100000
100000
Add: Provision for Tax 80000
Dividend Paid ( Proposed Dividend of Previous Year) 60000 140000
Net profit before tax and Extraordinary items: 240000
Add : Non-Cash and Non-Operating Expenses :
Depreciation (WN 2) 12000
Amortisation of Patents 5000
Loss on Sale of Building 5000 22000
Operating Profit before Working Capital Changes 262000
Less: Increase in Current Assets and Decrease in Current Liabilities
Inventories 5000
Trade Receivables 75000
 Trade Payables 15000 95000
Cash generated from Operating Activities 167000
Less : Tax Paid (WN 1) 50000
Cash Flow from Operating Activities 117000
B. Cash Flow from Investing Activities
Proceeds from Sale of Building 58000
Payment for Purchase of Building -75000
Payment for Purchase of Non-Current Investments -75000 -92000
Cash Used in Investing Activities -92000
C. Cash Flow from Financing Activities
Proceeds from issue of Shares 200000
-
Repayment of Lon-term Borrowings 100000
Payment of Short-term Borrowings -10000
Repayment of Dividend (Previous Year's Proposed Dividend) -60000 30000
Cash Flow from Financing Activities 30000
D. Net Increase in Cash and Cash Equivalents (A+B+C) 55000
Add: Opening Cash and Cash Equivalents 30000
E.Closing Cash and Cash Equivalents 85000

Building Account
Particulars Amount Particulars Amount
To Balance B/d 600000 By Bank A/c (sale) 58000
To Bank A/c (Purchased) 75000 By Depreciation A/c ( Bal Fig) 12000
By Loss on Sale of Building A/c) 5000
(Statement of P&L A/c)
By Balance c/d 600000
675000 675000

Provision for Tax Account

Particulars Amount Particulars Amount
To Bank A/c (Tax Paid) Bal Fig 50000 By Balance b/d 40000
To Balance c/d 70000 By Statement of Profit & Loss (Tax Provided) 80000
120000 120000