12th | Ts grewal 2021-2022 Question 45 to 48 | Cash Flow Statement

Page No 5.110:

Question 45:


Following is the Balance Sheet of Mevanca Limited as at 31st March, 2017:

Mevanca Limited BALANCE SHEET
as at 31st March, 2017:

Particulars

Note No.

31st March, 2017

(₹)

31st March, 2016

(₹)

I. EQUITY AND LIABILITIES

1. Shareholders' Funds

(a) Share Capital

3,00,000

1,00,000

(b) Reserves and Surplus

1

25,000

1,20,000

2. Non-Current Liabilities

Long-term Borrowings

2

80,000

60,000

3. Current Liabilities

(a) Trade Payables

6,000

20,000

(b) Short-term Provisions

3

68,000

70,000

Total

4,79,000

3,70,000

II. ASSETS

1. Non-Current Assets

Fixed Assets

4

3,36,000

1,92,000

2. Current Assets

(a) Inventories

67,000

60,000

(b) Trade Receivables

51,000

65,000

(c) Cash and Cash Equivalents

25,000

49,000

(d) Other Current Assets

4,000

Total

4,79,000

3,70,000

 

Notes to Accounts

 

Particulars

31st March, 2017

(₹)

31st March, 2016

(₹)

1. Reserves and Surplus

Surplus, i.e., Balance in Statement of Profit and Loss

25,000

1,20,000

25,000

1,20,000

2. Long-term Borrowings

10% Long-term Loan

80,000

60,000

80,000

60,000

3. Short-term Provisions

Provision for Tax

68,000

70,000

68,000

70,000

4. Fixed Assets

Machinery

3,84,000

2,15,000

Accumulated Depreciation

(48,000)

(23,000)

3,36,000

1,92,000

Additional Information:
(i) Additional loan was taken on 1st July, 2016.
(ii) Tax of ₹ 53,000 was paid during the year.
Prepare Cash Flow Statement.

Answer:

Cash flow Statement 

for the year ended 31st March, 2017

Particulars

( `)

( `)

A. Cash Flow from Operating Activities

 

 

Net Loss as per Statement of Profit and Loss

(95,000)

 

Add: Provision for Tax made (WN1)

51,000

 

Net loss before Tax and Extraordinary Items

(44,000)

 

Add: Depreciation charged during the year

25,000

 

Interest paid on loan (WN2)

7,500

 

Net Loss before Working Capital Changes

(11,500)

 

Add: Decrease in Trade Receivables

14,000

 

Decrease in other Current Assets

4,000

 

Less: Decrease in Trade Payables

(14,000)

 

Increase In Inventories

(7,000)

 

Net Loss before Tax

(14,500)

 

Add: Tax to be paid during the year

(53,000)

 

Cash used in Operating Activities

 

(67,500)

B. Cash Flow from Investing Activities

 

 

Purchase of Machinery

(1,69,000)

 

Cash used in Investing Activities

 

(1,69,000)

C. Cash Flow from Financing Activities

 

 

Proceeds from Issue of Shares

2,00,000

 

Proceeds from additional loan taken

20,000

 

Interest paid on long-term loan

(7,500)

 

Cash flow from Financing Activities

 

2,12,500

Net decrease in Cash and Cash Equivalents

 

(24,000)

Add: Opening Balance of Cash and Cash Equivalent

 

49,000

Cash and Cash Equivalents at the end of the year

 

25,000

 

 

 


  Working Notes:
1.

Dr.

Provision for Tax A/c

Cr.

Date

Particulars

Amount

( `)

Date

Particulars

Amount

( `)

2017

 

 

2016

 

 

March 31

To Cash A/c- Tax Paid

53,000

April 01

By balance b/d

70,000

March 31

To balance c/d

68,000

2017

 

 

 

 

 

March 31

By Statement of Profit & Loss A/c

51,000

 

 

 

 

 

 

 

 

1,21,000

 

 

1,21,000

 

 

 

 

 

 


2. Interest on Loan
Interest on Loan taken on 1st July, 2016=  `. 20,000×10/100×9/12=  `. 1,500

Interest on Loan as on 31st March, 2016=  `. 60,000×10100=  `. 6,000

Total Interest Paid on Loan=  `. (6,000+1,500)=  `. 7,500

 


Page No 5.111:

Question 46:


Following is the Balance sheet of X Ltd. as at 31st March, 2018;

BALANCE SHEET OF X LTD. as at 31st March, 2018

Particulars

Note No.

31st March, 2020 (`)

31st March, 2017 (`)

I. EQUITY AND LIABILITIES

1. Shareholders’ Funds

(a) Share Capital

(b) Reserves and Surplus

2. Non-Current Liabilities

Long-term Borrowings

3. Current Liabilities

(a) Short-term Borrowings

(b) Short-term Provisions

 

 

 

1

 

2

 

3

4

 

 

19,00,000

6,00,000

 

5,00,000

 

1,70,000

2,00,000

 

 

17,00,000

3,00,000

 

4,00,000

 

1,75,000

1,65,000

Total

 

33,70,000

27,40,000

ASSETS

1. Non-Current Assets

(a) Fixed Assets:

(i) Tangible Assets

(ii) Intangible Assets

(b) Non-current Investments

2. Current Assets

(a) Current Investments

(b) Inventories

(c) Cash and Cash Equivalents

 

 

 

5

6

 

 

 

 

24,00,000

2,00,000

3,00,000

 

1,40,000

2,60,000

70,000

 

 

 

19,00,000

3,00,000

2,00,000

 

1,70,000

1,30,000

40,000

Total

 

33,70,000

27,40,000

Notes to Accounts

Particulars

31st March, 2018 (`)

31st March, 2017 (`)

  1. Reserves and! Surplus

Surplus, i.e., Balance in Statement of Profit and Loss

 

6,00,000

 

3,00,000

 

6,00,000

3,00,000

2, Long-term Borrowings

 12% Debentures

 

5,00,000

 

4,00,000

 

5,00,000

 

4,00,000

3.Short-term Borrowings

Bank Overdraft

 

1,70,000

 

1,75,000

 

1,70,000

1,75,000

Å, Short-term Provisions

Provision for Tax

 

2,00,000

 

1,65,000

 

2,00,000

1,65,000

5. Tangible Assets Machinery

Less: Accumulated Depreciation

26,00,000 (2,00,000)

20,00,000 (1,00,000)

 

24,00,000

19,000,000

6. Intangible Assets

Goodwill

 

2,00,000

 

3,00,000

 

2,00,000

3,00,000

Additional Information:

(i) `1,00,000, 12% Debentures were issued on 1st April, 2017.

(ii) During the year, a piece of machinery costing ` 80,000 on which accumulated depreciation was ` 40,000 was sold at a gain of `10,000.

Prepare a Cash Flow Statement.  (CBSE 2019C)

 

Answer:

Cash Flow Statement

 

Particulars

Detail

`

I.                   Cash  flow from operating activities

Net profit as per Statement of profit and loss

(6,00,000-3,00,000)

 Add:

Provision for Tax

 

 

3,00,000

 

 

2,00,000

Net profit before tax and extraordinary items

Add:

Depreciation on Machinery

Goodwill amortised

Interest on debentures

 

 

1,40,000

1,00,000

60,000

5,00,000

,

 

 

3,00,000

Less:

Gain on Sale of machinery

 

8,00,000

(10,000)

Operating Profit Before Working Capital Changes

Less:

Inventories

 

 

 

7,90,000

 

(1,30,000)

Cash Generated from operation

 

6,60,000

Less: Tax paid

 

(1,65,000)

Cash flow from operating activities

 

4,95,000

 

II.                Cash  flow from Investing activities

Proceeds From sale of Machinery

Payments for the purchase of Machinery

Payments for the purchase of Current Investment

 

 

 

50,000

(6,80,000)

(1,00,000)

Cash Used in Investing activities

 

(7,30,000)

III.             Cash flow from Financing activities

Proceeds from Issue of Shares

Proceeds from Issue of Debenture

Decrease in Bank Overdraft

Payment of Interest on Debenture

 

 

 

 

2,00,000

1,00,000

(5,000)

(60,000)

Cash used in Financing activities

 

2,35,000

Net Decrease in Cash and cash equivalents

Add: Opening Cash and Cash Equivalents

 

Nil

2,10,000

Closing Cash and Cash Equivalents

 

2,10,000

 

Working notes:

Dr.

Fixed Assets A/c

Cr.

Particulars

`

Particulars

`

To Balance B/d

To P&L a/c (Gain on sale)

To Bank a/c (Purchase)

20,00,000

40,000

6,80,000

By Provision for Dep. a/c

By Bank a/c (sale)

By Balance C/d

40,000

50,000

26,00,000

 

26,90,000

 

26,90,000

Space

Dr.

Provision for Depreciation A/c

Cr.

Particulars

`

Particulars

`

To Machinery a/c

To Balance C/d

40,000

2,00,000

By Balance B/d

By P&L a/c

(Dep. provided during the year)

1,00,000

1,40,000

 

 

2,40,000

 

2,40,000

 


Page No 5.112:

Question 47:


Following was the Balance Sheet of M.M. Ltd. as at 31st March, 2015:

Particulars

Note No.

2015

( `)

2014

( `)

I. EQUITY AND LIABILITIES

 

 

 

1. Shareholders' Funds

 

 

 

(a) Share Capital

 

5,00,000

4,00,000

(b) Reserves and Surplus

1

2,00,000

(50,000)

2. Non-Current Liabilities

 

 

 

Long-term Borrowings

2

4,50,000

5,00,000

3. Current Liabilities

 

 

 

(a) Short-term Borrowings

3

1,50,000

50,000

(b) Short-term Provisions

4

70,000

90,000

Total      

 

13,70,000

9,90,000

II. ASSETS

 

 

 

1. Non-Current Assets

 

 

 

(a) Fixed Assets:

 

 

 

(i) Tangible Assets

5

10,03,000

7,20,000

 (ii) Intangible Assets

6

20,000

30,000

(b) Non-Current Investments

 

1,00,000

75,000

2. Current Assets

 

 

 

(a) Current Investments

 

50,000

60,000

(b) Inventories

7

1,07,000

45,000

(c) Cash and Cash Equivalents

 

90,000

60,000

Total

 

13,70,000

9,90,000

 

 

 

 


Notes to Accounts
 

Particular

31st March 2015

( `)

31st March 2014

( `)

1.

Reserves and Surplus

 

 

 

Surplus, i.e., Balance in Statement of Profit and Loss

2,00,000

(50,000)

 

 

2,00,000

(50,000)

2.

Long-term Borrowings

 

 

 

12% Debentures

4,50,000

5,00,000

 

 

4,50,000

5,00,000

3.

Short-term Borrowings

 

 

 

Bank Overdraft

1,50,000

50,000

 

 

1,50,000

50,000

4.

Short-term Provisions

 

 

 

Provision for Tax

70,000

90,000

 

 

70,000

90,000

5.

Tangible Assets

 

 

 

Machinery

12,03,000

8,21,000

 

  Less: Accumulated Depreciation

(2,00,000)

(1,01,000)

 

 

10,03,000

7,20,000

6.

Intangible Assets

 

 

 

Goodwill

20,000

30,000

 

 

20,000

30,000

7.

Inventories

 

 

 

Stock-in-Trade

1,07,000

45,000

 

 

1,07,000

45,000

 

 

 

 


Additional Information:
1. 12% Debentures were redeemed on 31st March, 2015.
2. Tax  ` 70,000 was paid during the year.
Prepare Cash Flow Statement.

Answer:

 

Cash Flow Statement 

for the year ended 31st March, 2015

 

 

Particulars

 ( `)

 ( `)

 

I

Cash Flow from Operating Activities

 

 

 

 

A. Net Profit before Tax and Extraordinary items*

 

2,50,000

 

 

Adjustments for Non-cash and Non-operating items

 

 

 

 

B. Add: Items to be Added

 

 

 

 

Depreciation

99,000

 

 

 

Intangible Assets Written off

10,000

 

 

 

Interest on Debentures (12% of 5,00,000)

60,000

 

 

 

Provision for Tax

50,000

2,19,000

 

 

C. Less: Items to be Deducted

 

 

 

 

 

 

 

 

 

D. Operating Profit before Working Capital Adjustments (A + B – C)

 

4,69,000

 

 

E. Add: Decrease in Current Assets and Increase in Current Liabilities

 

 

 

 

F. Less: Increase in Current Assets and Decrease in Current Liabilities

 

 

 

 

Inventories

62,000

(62,000)

 

 

Cash Generated from Operations (D + E – F)

 

4,07,000

 

 

Less: Income Tax Paid (Net of Refund)

70,000

(70,000)

 

 

Net Cash Flows from (or used in) Operating Activities

 

3,37,000

 

 

 

 

 

 

 

II

Cash Flow from Investing Activities

 

 

 

 

Purchase of Fixed Assets (12,03,000 – 8,21,000)

(3,82,000)

 

 

 

Purchase of Non-Current Investments

(25,000)

 

 

 

Net Cash Flows from (or used in) Investing Activities

 

(4,07,000)

 

 

 

 

 

 

III

Cash Flow from Financing Activities

 

 

 

 

Proceeds from Issue of Share Capital

1,00,000

 

 

 

Redemption of Debentures

(50,000)

 

 

 

Interest Paid on Debentures

(60,000)

 

 

 

Increase in Bank Overdraft

1,00,000

 

 

 

Net Cash Flow from Financing Activities

 

90,000

 

 

 

 

 

 

 

IV

Net Increase or Decrease in Cash and Cash Equivalents (I + II + III)

 

20,000

 

 

 

Add: Cash and Cash Equivalent in the beginning of the period

 

1,20,000

 

 

 

(Includes Current Investments of  ` 60,000)

 

 

 

 

Cash and Cash Equivalents at the end of the period

 

1,40,000

 

 

(Includes Current Investments of  ` 50,000)

 

 

 

 

 

 

 

 

 

 

 

Provision for Tax Account

 

Dr.

Cr.

 

Particulars

Amount

( `)

Particulars

Amount

( `)

 

Bank A/c

70,000

Balance b/d

90,000

 

Balance c/d

70,000

Statement of Profit and Loss

50,000

 

 

1,40,000

 

1,40,000

 

 

 

 

 

 


Page No 5.113:

Question 48:


From the following Balance Sheet of Gopal Ltd. and the additional information as at 31st March. 2019.

Prepare a Cash Flow Statement when Cash Flows from Financing Activities is ` 2,32,000;

Particulars

Note No.

31st March, 2019 (`)

31st March, 2018 (`)

I. EQUITY AND LIABILITIES

 

 

 

1. Shareholders' Funds

 

 

 

(a) Share Capital

 

10,00,000

8,00,000

(b) Reserves and Surplus

1

4,00,000

(1,00,000)

2. Non-Current Liabilities

 

 

 

Long-term Borrowings

2

9,00,000

9,00,000

3. Current Liabilities

 

 

 

(a Short-term Borrowings

3

2,40,000

1,00,000

(b) Short-term Provisions

4

2,00,000

1,75,000

Total

 

27,40,000

18,75,000

 

 

 

 

Il. ASSETS

 

 

 

1. Non-Current Assets

 

 

 

(a) Property, Plant and Equipment (Fixed Assets):

 

 

 

(i) Tangible Assets

5

20,00,000

14,42,000

(ii) Intangible Assets

6

46,000

58,000

(b) Non-current Investments

 

1,00,000

45,000

2. Current Assets

 

 

 

(a) Current Investments

 

2,00,000

1,20,000

(b) Inventories

7

2,14,000

90,000

(c) Cash and Cash Equivalents

 

1,80,000

1,20,000

Total

 

27,40,000

18,75,000

 

Notes to Accounts

Particulars

31st March, 2019 (`)

31st March,

2018 (`)

1. Reserves and Surplus

 

 

Surplus, i.e., Balance in Statement of Profit and Loss

4,00,000

(1,00,000)

2. Long-term Borrowings

 

 

12% Debentures

9,00,000

9,00,000

3. Short-term Borrowings

 

 

Bank Overdraft

240,000

1,00,000

4. Short-term Provisions

 

 

Provision for Tax

2,00,000

1,75,000

5. Tangible Assets

 

 

Machinery

24,00,000

16,42,000

Less: Accumulated Depreciation

(4,00,000)

(2,00,000)

 

20,00,000

14,42,000

6. Intangible Assets

 

 

Goodwill

46,000

58,000

7. Inventories

 

 

Stock-in-Trade

2,14,000

90,000

Additional Information: Tax ` 1,50,000 was paid during the year. (CBSE 2020).

Answer:

Sheet of Gopal Ltd

Cash Flow Statement as at 31st March. 2019

Particulars

Detail

`

I. Cash Flow From Operating Activity

 

 

Surplus, i.e., Balance in Statement of Profit and Loss

 

5,00,000

Add:

Provision for Tax

 

1,75,000

 

 

 

 

Add:

Depreciation on machinery

2,00,000

 

 

Goodwill Amortised

12,000

 

 

Interest on Debenture

1,08,000

3,20,000

Operating Profit Before Working Capital Changes

 

9,95,000

Add:

Increase in Liabilities and Decrease in Assets

 

 

 

Inventories

 

1,24,000

Cash Generated From Operation

 

8,71,000

Less:

Tax Paid

 

1,50,000

Cash Flow From Operating Activity

 

7,21,000

 

 

 

II.

Cash Flow From Investing Activity

 

 

 

Payment for purchase of Machinery

 

(7,58,000)

 

Payment for purchase of Investing

 

(55,000)

Cash Flow From Investing Activity

 

(8,13,000)

 

 

 

III.

Cash Flow From Financing Activity

 

 

 

Issue of shares

2,00,000

 

 

Increase in Bank Over draft

1,40,000

3,40,000

 

Payment of Interest on Debenture

 

(1,08,000)

Cash Flow From Financing Activity

 

2,32,000

IV.

Net increase in Cash and Cash Equivalents

 

1,40,000

 

(7,21,000+(8,13,000)+2,32,000)

 

 

Add:

Opening Cash and Cash Equivalents

 

2,40,000

 

Closing Cash and Cash Equivalents

 

3,80,000


Working Notes:

Dr.

Provision for Tax A/c

Cr.

Particulars

`

Particulars

`

To Bank A/c

To Balance C/d

1,50,000

2,00,000

By Balance B/d

By P&L a/c

(Tax provided during the year)

1,75,000

1,75,000

 

 

3,50,000

 

3,50,000