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12th | Cash Flow Statement | Question No. 25 To 28 | Ts Grewal Solution 2022-2023

Question 25:


From the following details. calculate Cash Flow from Investing Activities

 

 

 

Particulars

Closing

(`)

Opening

 (`)

Machinery (At Cost)

10,00,000

9,50,000

Accumulated Depreciation

1,50,000

1,10,000

Patents

2,00,000

3,00,000

 

 

 

 

 

 

Additional Information:

  1. During the year, machine costing ` 90,000 with accumulated depreciation of ` 60,000 was sold for ` 50,000.
  2. Patents written off were ` 50,000 while a part of patents were sold at a profit of ` 40,000.

Answer:


Cash Flow from Investing Activities

 

Particulars

 (`)

 (`)

 

 

Purchase of Machinery (WN1)

(1,40,000)

 

 

 

Sale of Machinery

50,000

 

 

 

Sale of Patents (WN3)

90,000

Nil

 

Net Cash Used in Investing Activities

 

Nil

 

Working Notes:

 

WN1:

 

Machinery Account

Dr.

 

Cr.

Particulars

 (`)

Particulars

 (`)

Balance b/d

9,50,000

Provision for Depreciation A/c

60,000

Profit and Loss A/c

(Profit on Sale)

20,000

Bank A/c (Sale)

50,000

Bank A/c (Purchase)

1,40,000

Balance c/d

10,00,000

 

11,10,000

 

11,10,000

 

 

 

 

 

 

 

WN2:

 

Provision for Depreciation Account

Dr.

 

Cr.

Particulars

 (`)

Particulars

 (`)

Asset A/c

60,000

Balance b/d

1,10,000

Balance c/d

1,50,000

Profit and Loss A/c

(Depreciation charged during the year)

1,00,000

 

2,10,000

 

2,10,000

 

 

 

 

 

 

 WN3:

 

Patents Account

Dr.

 

Cr.

Particulars

 (`)

Particulars

 (`)

Balance b/d

3,00,000

Patents Written off

50,000

Profit and Loss A/c

(Profit on Sale)

40,000

Bank A/c (Sale) (Balancing Figure)

90,000

 

 

Balance c/d

2,00,000

 

3,40,000

 

3,40,000

 

 

 

 

 

 

Question 26:


Welprint Ltd. has given the following information:

`

Machinery as on 1st April, 2021

50,000

Machinery as on 31st March, 2022

60,000

Accumulated Depreciation on 1st April, 2021

25,000

Accumulated Depreciation on 31st march, 2022

15,000

During the year, a machine costing ` 25,000 (accumulated depreciation thereon ` 15,000) was sold for ` 13,000.

Calculate Cash Flow from Investing Activities on the basis of the above information.

Answer:


Cash Flow Statement

 

Particulars

 (`)

 (`)

 

Cash Flow from Investing Activities

 

 

 

Purchase of Machinery

(35,000)

 

 

Sale of Machinery

13,000

(22,000)

 

Cash Used in Investing Activity

 

(22,000)


Working Notes:

Machinery Account

Dr.

 

Cr.

Particulars

 (`)

Particulars

 (`)

Balance b/d

50,000

Bank A/c

13,000

Profit and Loss A/c

3,000

Accumulated Depreciation A/c

15,000

Bank A/c (Bal. Fig.)

35,000

Balance c/d

60,000

 

88,000

 

88,000

 

 

 

 

 

Accumulated Depreciation Account

Dr.

Cr.

Particulars

 (`)

Particulars

 (`)

Machinery A/c

15,000

Balance b/d

25,000

Balance c/d

15,000

Profit and Loss A/c
(Bal. Fig.)

5,000

 

30,000

 

30,000

 

 

 

 

                    

Question 27:


From the following extracts of a company, calculate Cash Flow from Investing Activities:

Particular

31st March,

2022

(`)

31st March,

2021

(`)

Goodwill

75,000

1,00,000

Patents

1,00,000

75,000

Land

90,000

1,00,000

Furniture

2,46,000

21,000

Plant and Machinery (Net)

2,00,000

2,00,000

10% Investments

1,80,000

2,00,000

Accrued Interest on Investments

6,000

...

Answer:


Cash Flow from Investing Activities

 

Particulars

Amount

(`)

Amount

(`)

 

Purchase of Patents

(25,000)

 

 

Purchase of Furniture

(2,25,000)

 

 

Interest received on Investment

14,000

 

 

Sale of Investment

20,000

 

 

Sale of Land

10,000

 

 

Net Cash Used in Investing Activities

 

(2,06,000)

Note: It has been assumed that Investments have been sold at their Book Value at the end of the accounting period.

Working Notes:

Computation of Interest on Investments

Interest on Investments=2,00,000×10/100

Less: Interest Accrued

=20,000

= 6,000

Interest Received On Investment

= 14,000

 

Question 28:


From the following information, calculate Cash Flow from Investing Activities

Particular

31st March,
2022

(`)

31st March,
2021

(`)

Plant and Machinery

10,00,000

8,50,000

Investment (Long-term)

1,00,000

40,000

Land (At Cost)

1,00,000

2,00,000

Additional Information:
1. Depreciation charged on Plant and Machinery ` 50,000.
2. Plant and Machinery with a Book Value of ` 60,000 was sold for ` 40,000.
3. Land was sold at a profit of ` 60,000.
4. No investment was sold during the year.

Answer:


Cash Flow from Investing Activities

 

Particulars

 (`)

 (`)

 

Purchase of Plant and Machinery (WN1)

(2,60,000)

 

 

Purchase of Investments

(60,000)

 

 

Sale of Plant and Machinery (WN1)

40,000

 

 

Sale of Land (WN2)

1,60,000

 

 

Net Cash Used in Investing Activities

 

(1,20,000)

Working Notes:

WN1

Plant and Machinery Account

Dr.

Cr.

Particulars

 (`)

Particulars

 (`)

Balance b/d

8,50,000

Depreciation A/c

50,000

Bank A/c (Purchases- Bal. Fig.)

2,60,000

Bank A/c (Sale)

40,000

 

 

Profit and Loss A/c (Loss on Sale)

20,000

 

 

Balance c/d

10,00,000

 

11,10,000

 

11,10,000

 

 

 

 

WN2

Land Account

Dr.

Cr.

Particulars

 (`)

Particulars

 (`)

Balance b/d

2,00,000

Bank A/c (Sale- Bal. Fig.)

1,60,000

Profit and Loss A/c (Profit on Sale)

60,000

Balance c/d

1,00,000

 

2,60,000

 

2,60,000

 

 

 

 

 

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Ts Grewal Solution 2022-2023

Class 12 / Volume – 3

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