Cash
Flow from Investing and Financing Activities
Question 37:
From
the following information, calculate Cash Flow from Investing and Financing
Activities:
|
Particulars |
31st March 2025 (₹) |
31st March 2024 (₹) |
|
Machinery (At cost) |
50,000 |
40,000 |
|
Accumulated Depreciation |
12,000 |
10,000 |
|
Capital |
35,000 |
30,000 |
|
Bank Loan |
... |
10,000 |
During
the year, a machine costing
₹ 10,000 was sold at a loss of ₹ 2,000. Depreciation on machinery
charged during the year amounted to ₹ 6,000.
Answer:
|
Cash Flow
Statement for the year ended March 31, 2025 |
|||
|
|
Particulars |
(₹) |
(₹) |
|
|
Cash Flow from Investing Activities |
|
|
|
|
Purchase of Machinery |
(20,000) |
|
|
|
Sale of Machine |
4,000 |
|
|
|
Net Cash from (used
in) Investing Activities |
|
(16,000) |
|
|
|
|
|
|
|
Cash Flow from Financing Activities |
|
|
|
|
Proceeds from Issue of Equity Shares |
5,000 |
|
|
|
Repayment of Bank Loan |
(10,000) |
|
|
|
Net Cash from
(used in) Financing Activities |
|
(5,000) |
|
|
|
|
|
Working
Notes:
|
Machinery Account |
|||
|
Dr. |
Cr. |
||
|
Particulars |
(₹) |
Particulars |
(₹) |
|
Balance
b/d |
40,000 |
Accumulated
Depreciation A/c |
4,000 |
|
Bank
A/c (Purchase- Bal. Fig.) |
20,000 |
Bank
A/c (Sale) |
4,000 |
|
|
|
Profit
and Loss A/c (Loss on Sale) |
2,000 |
|
|
|
Balance
c/d |
50,000 |
|
|
60,000 |
|
60,000 |
|
|
|
|
|
|
Accumulated Depreciation Account |
|||
|
Dr. |
Cr. |
||
|
Particulars |
(₹) |
Particulars |
(₹) |
|
To
Machinery A/c (Bal. Fig.) |
4,000 |
Balance
b/d |
10,000 |
|
Balance
c/d |
12,000 |
By
Profit and Loss A/c (Dep. charged during the year) |
6,000 |
|
|
16,000 |
|
16,000 |
|
|
|
|
|
Question
38:
From the following information, calculate (a) Cash
Flow from Investing Activities; and (b) Cash Flow from Financing Activities:
|
Particulars | |
31st March, 2024 (₹) |
31st March, 2025 (₹) |
|
Plant and Machinery |
8,50,000 |
10,00,000 |
|
Non-Current Investments |
40,000
|
1,00,000 |
|
Land (at Cost) |
2,00,000
|
1,00,000 |
|
Equity Share Capital |
20,00,000
|
30,00,000 |
|
109% Preference Share Capital |
2,00,000 |
1,00,000 |
|
Securities Premium |
- |
1,00,000 |
|
10% Debentures |
10,00,000 |
10,00,000 |
Additional Information:
(i) Depreciation charged
on Plant and Machinery was 50,000.
(ii) Plant and Machinery of book value 60,000 was
sold fort 40,000.
(iii) Land was sold at a gain of 60,000.
(iv) Preference
Shares were redeemed on 31st March, 2025 at a premium of 5%.
(v) Dividend on Equity Shares and Preference Shares
for the year ended 31st March, 2024 was Nil and for the year ended 31st March, 2025.
Proposed Dividend on Equity Shares was 10%.
(vi) Fresh
issue of Equity Shares was on 1st April, 2024.
Answer:
|
|
Cash Flow
Statement for the year ended March 31, 2025 |
|||
|
|
Particulars |
Amount (₹) |
Amount (₹) |
|
|
I. |
Cash Flow
from Investing Activities |
|
|
|
|
|
Proceeds from sale of Plant and machinery |
|
40,000 |
|
|
|
Proceeds from sale of Land |
|
1,60,000 |
|
|
|
Purchase of Plant and machinery |
|
(2,60,000) |
|
|
|
Purchase of Non-Current Investments |
|
(60,000) |
|
|
|
|
|
|
|
|
|
Cash Used in
Investing Activities |
|
(1,20,000) |
|
|
|
||||
|
|
Particulars |
Amount (₹) |
Amount (₹) |
|
|
I. |
Cash Flow
from Financing Activities |
|
|
|
|
Add: |
Issue of Equity Share Capital |
10,00,000
|
|
|
|
|
Securities Premium Received |
1,00,000 |
11,00,000 |
|
|
Less: |
Preference Shares were redeemed |
(1,00,000) |
|
|
|
|
Premium Paid on redemption |
(5,000) |
|
|
|
|
Interest on debenture paid |
(1,00,000) |
(2,05,000) |
|
|
|
Cash Flow
from Financing Activities |
|
8,95,000 |
|
Working
Notes:
|
Plant and Machinery |
|||
|
Particulars |
₹ |
Particulars |
₹ |
|
To balance b/d |
8,50,000 |
By P&L A/c(Loss) |
20,000 |
|
To
bank A/c– Bal. figure |
2,60,000 |
By
Bank A/c(Sale) Bal. |
40,000 |
|
(Purchase) |
|
By P&L A/c(Dep.) |
50,000 |
|
|
|
By balance C/d |
10,00,000 |
|
|
11,10,000 |
|
11,10,000 |
|
|
|
|
|
|
Land ac |
|||
|
Particulars |
₹ |
Particulars |
₹ |
|
To balance b/d |
2,00,000 |
By
Bank A/c(Sale) Bal. |
1,60,000 |
|
To
P&L A/c(Gain) |
60,000 |
|
|
|
|
|
By balance C/d |
1,00,000 |
|
|
2,60,000 |
|
2,60,000 |
|
|
|
|
|
|
Non-Current Investments ac |
|||
|
Particulars |
₹ |
Particulars |
₹ |
|
To balance b/d |
40,000 |
By balance C/d |
1,00,000 |
|
To
Bank A/c(Purchase) Bal. |
60,000 |
|
|
|
|
2,60,000 |
|
2,60,000 |
Cash
Flow Statement
Question 39:
From
the following information, prepare Cash Flow Statement:
|
Particulars |
(₹) |
|
Opening
Cash and Bank Balances |
1,50,000 |
|
Closing
Cash and Bank Balances |
1,70,000 |
|
Decrease
in Stock |
80,000 |
|
Increase
in Bills Payable |
1,20,000 |
|
Sale of
Fixed Assets |
3,00,000 |
|
Repayment
of Long-term Loan |
5,00,000 |
|
Net Profit
for the Year |
20,000 |
Answer:
|
Cash Flow
Statement |
||||
|
|
Particulars |
(₹) |
(₹) |
|
|
A |
Cash Flow from Operating Activities |
|
|
|
|
|
Profit as per Statement of Profit and Loss (Net
Profit) |
20,000 |
|
|
|
|
Profit Before Taxation |
20,000 |
|
|
|
|
Items to be Added: |
– |
|
|
|
|
Operating Profit before
Working Capital Adjustments |
20,000 |
|
|
|
|
Add: Decrease in Current Assets |
|
|
|
|
|
Stock |
80,000 |
|
|
|
|
Add: Increase in Current Liabilities |
|
|
|
|
|
Bills
Payable |
1,20,000 |
|
|
|
|
Cash
Generated from Operations |
2,20,000 |
|
|
|
|
Less: Tax Paid |
– |
|
|
|
|
Net Cash Flow from Operating Activities |
|
2,20,000 |
|
|
|
|
|
|
|
|
B |
Cash Flow from Investing Activities |
|
|
|
|
|
|
Sale of Fixed Assets |
3,00,000 |
|
|
|
Net Cash Flows from Investing Activities |
|
3,00,000 |
|
|
|
|
|
|
|
|
C |
Cash Flow from Financing Activities |
|
|
|
|
|
Repayment of Long-Term Loan |
(5,00,000) |
|
|
|
|
Net Cash Used in Financing Activities |
|
(5,00,000) |
|
|
|
|
|
|
|
|
D |
Net Increase or Decrease in Cash and Cash
Equivalents |
|
20,000 |
|
|
|
|
Add: Cash and Cash Equivalent in the beginning of the
period |
|
1,50,000 |
|
|
Cash and Cash Equivalents at the end of the period |
|
1,70,000 |
|
|
|
|
|
|
|
Question 40:
From
the following Balance Sheet of Young India Ltd., prepare Cash Flow Statement:
|
BALANCE
SHEET OF YOUNG INDIA LTD. |
|||
|
Particular |
Note No. |
31st March, 2025(₹) |
31st March, 2024(₹) |
|
I. EQUITY AND LIABILITIES |
|
|
|
|
1. Shareholders' Funds |
|
|
|
|
(a)
Share Capital |
|
2,50,000 |
2,00,000 |
|
(b) Reserves
and Surplus: Surplus, i.e., Balance in Statement of Profit and Loss |
|
1,83,000 |
82,000 |
|
2. Non-Current Liabilities |
|
|
|
|
Long-term Borrowings: |
|
|
|
|
15%
Debentures |
|
80,000 |
50,000 |
|
3. Current Liabilities |
|
|
|
|
(a)
Trade Payables |
|
1,50,000 |
1,10,000 |
|
(b)
Other Current Liabilities |
|
12,000 |
20,000 |
|
Total |
|
6,75,000 |
4,62,000 |
|
II. ASSETS |
|
|
|
|
1. Non-Current Assets |
|
|
|
|
(a)
Fixed Assets (Tangible) |
|
2,74,000 |
1,17,000 |
|
(b)
Non-Current Investments |
|
68,000 |
55,000 |
|
2. Current Assets |
|
|
|
|
(a)
Inventories |
|
2,06,000 |
1,50,000 |
|
(b)
Trade Receivables |
|
32,000 |
70,000 |
|
(c) Cash
and Cash Equivalents |
|
95,000 |
70,000 |
|
Total |
|
6,75,000 |
4,62,000 |
|
|
|
|
|
Answer:
|
Cash Flow
Statement for the year ended March 31, 2025 |
|||
|
|
Particulars |
(₹) |
(₹) |
|
A |
Cash Flow from Operating Activities |
|
|
|
|
Profit as per Statement of Profit and Loss (1,83,000
– 82,000) |
1,01,000 |
|
|
|
Profit Before
Taxation |
1,01,000 |
|
|
|
Items to be Added: |
|
|
|
|
Interest on Debentures |
7,500 |
|
|
|
Operating
Profit before Working Capital Adjustments |
1,08,500 |
|
|
|
Less: Increase in Current Assets |
|
|
|
|
Inventories |
(56,000) |
|
|
|
Add: Increase in Current Liabilities |
|
|
|
|
Trade
Payables |
40,000 |
|
|
|
Less: Decrease in Current Liabilities |
|
|
|
|
Other Current
Liabilities |
(8,000) |
|
|
|
Add:Decrease
in Current Assets |
|
|
|
|
Trade Receivables |
38,000 |
|
|
|
Cash Generated
from Operations |
1,22,500 |
|
|
|
Less: Tax Paid |
– |
|
|
|
Net Cash Flows from Operating Activities |
|
1,22,500 |
|
|
|
|
|
|
B |
Cash Flow from Investing Activities |
|
|
|
|
Purchase of Fixed Assets |
(1,57,000) |
|
|
|
Purchase of Investments |
(13,000) |
|
|
|
Net Cash Used in Investing Activities |
|
(1,70,000) |
|
|
|
|
|
|
C |
Cash Flow from Financing Activities |
|
|
|
|
Proceeds from Issue of Equity Share Capital |
50,000 |
|
|
|
Proceeds from Issue of 15% Debentures |
30,000 |
|
|
|
Interest on Debentures (50,000 × 15%) |
(7,500) |
|
|
|
Net Cash Flow from Financing Activities |
|
72,500 |
|
|
|
|
|
|
D |
Net Increase or Decrease in Cash and Cash
Equivalents |
|
25,000 |
|
|
Add: Cash and Cash Equivalent in the beginning of the
period |
|
70,000 |
|
|
Cash and Cash Equivalents at the end of the period |
|
95,000 |
|
|
|
|
|
Note: It has been assumed that Debentures were issued at
the end of the accounting period. Therefore, interest on Debentures is computed
on the opening balance of the Debenture.
Click below for more Questions
Ts Grewal Solution 2025-2026
Class 12 / Volume – 3
Chapter 5 – Cash Flow Statements