CHAPTER 12 CASH FLOW STATEMENT Question 12.1 Prepare cash flow statement for the year ended 31 st March 2016 from the following balance sheets of KYC Ltd. Particulars I. EQUITY AND LIABILITIES Share holders funds a) Share capital b) Reserve and surplus Non-Current liabilities Long term borrowings Current liabilities a) Short term borrowings b) Trade payable c) Short term provision II. ASSETS Non- Current assets a) Fixed assets i) Tangible ii) Intangible b) Non- Current investments Current assets a) Current investments b) Trade receivables c) Inventories d) Cash and cash equivalents Notes to accounts : Note. No. 1 2 3 31.03.2016 31.03.2015 50,00,000 5,00,000 10,00,000 5,00,000 3,00,000 2,00,000 37,00,000 4,00,000 13,00,000 4,00,000 3,00,000 1,00,000 TOTAL 75,00,000 62,00,000 4 55,50,000 1,00,000 7,00,000 90,000 50,000 6,00,000 4,10,000 39,00,000 1,20,000 6,00,000 70,000 40,000 8,70,000 6,00,000 TOTAL 75,00,000 62,00,000 Particulars 31.03.2016 31.03.2015 1. Long term borrowings 10% Debentures 8% Loan from SFC 8,00,000 2,00,000 12,00,000 1,00,000 2. Short term borrowings Bank overdraft Cash credit 3. Short term provision 10,00,000 13,00,000 3,00,000 3,50,000 2,00,000 50,000 5,00,000 4,00,000
Proposed dividend Provision for tax 4. Fixed assets Tangible assets- Building Intangible assets - Goodwill Additional informations: 1,10,000 70,000 90,000 30,000 2,00,000 1,00,000 55,50,000 39,00,000 1,00,000 1,20,000 56,50,000 40,20,000 a) An unused Parking shed valued Rs. 1,00,000 was sold at a profit of Rs. 55,000 b) Building costing Rs. 15,00,000 was purchased during the year c) Interim dividend of Rs. 30,000 and tax paid during the year Rs. 25,000 d) Interest on investments received Rs. 60,000 Question 12.2 Calculate net cash flows from operating activities: 31.3.15 31.3.16 Particulars Rs. Rs. Profit and Loss Account 30,000 35,000 General Reserve 10,000 15,000 Provision for depreciation on plant 30,000 35,000 Outstanding expenses 5,000 3,000 Goodwill 20,000 10,000 Sundry debtors 40,000 35,000 An item of plant costing Rs. 20,000 having book value of Rs. 14,000 was sold for Rs. 18,000 during 2015 2016. Question 12.3 (SP 2017) From the following particulars, calculate Cash Flow from Investing Activities: [4] Assets Note. 31.03.2016 31.03.2015 Non-Current Assets No. ( ) ( ) (a) Fixed Assets
(i) Tangible 1 13,40,000 11,20,000 (ii) Intangible 2 4,60,000 4,80,000 (b) Non-Current Investments 3 2,60,000 1,60,000 Notes to Accounts: Particulars 31.03.2016 31.03.2015 ( ) ( ) 1 Tangible Fixed Assets Machinery 12,40,000 10,20,000 Land 1,00,000 1,00,000 13,40,000 11,20,000 2 Intangible Assets Goodwill 2,00,000 1,00,000 Patents 2,60,000 3,80,000 4,60,000 4,80,000 3. Non- Current Investments Shares of Finance Ltd. 2,60,000 1,60,000 Additional Information: (i) (ii) Patents were written off to the extent of 40,000 and some patents were sold at a profit of 20,000. A Machine costing 1,40,000 (depreciation provided thereon 60,000 ) was sold for 50,000. (iii) Depreciation charged during the year on Plant and Machinery was 1,40,000. (iv) Dividend received on shares 40,000.
Question 12.4 (SP2017) From the following extracts of a company s Balance Sheets, calculate Cash from Financing Activities for the year ending 31 st March, 2016: Particulars 31.3.2016 31.3.2015 ( ) ( ) Equity Share Capital 9,00,000 7,00,000 Securities Premium Reserve 1,25,000 1,00,000 12% Debentures 4,00,000 3,00,000 Proposed Dividend 60,000 70,000 Bank Overdraft 12,000 10,000 Additional information: (i) Dividend proposed on Equity Shares 65,000. (ii) Debentures were issued on 1 st April, 2015, at a discount of 10%. (iii) Unclaimed Dividend 7,000. Question 12.5 The following Balance Sheets of Humility Ltd, Prepare its Cash Flow Statement for the year 2014-2015. (as per AS 3) Particulars Note No. 2014-15 2013-14 I. EQUITY AND LIABILITIES Shareholders funds (a) Share capital 33,00,000 32,00,000 (b) Reserve and surplus 1 5,00,000 4,00,000 Non current liabilities Long term borrowing 2 16,00,000 15,00,000 Current liabilities
(a) Trade payable 3,00,000 5,00,000 (b) Short term provision 3 50,000 40,000 TOTAL 57,50,000 56,40,000 II ASSETS Non current assets (a) Fixed assets i) Tangible 4 39,50,000 34,60,000 ii) Intangible 50,000 40,000 (b) Non current investments 6,00,000 6,00,000 Current assets (a) Current investments 5 10,000 30,000 (b) Trade receivable 50,000 40,000 (c ) Inventories 6,00,000 8,00,000 (d) Cash and cash equivalents 4,90,000 6,70,000 TOTAL 57,50,000 56,40,000 Notes to account: 2014-15 2013-14 1. Reserve and surplus General reserve 3,50,000 2,80,000 Statement of P and L a/c 1,50,000 1,20,000 5,00,000 4,00,000 2. Long term Borrowings 10% Debentures 16,00,000 15,00,000 3. Short term provision Proposed dividend 20,000 13,000 Provision for taxation 30,000 27,000 50,000 40,000 4. Fixed assets Tangible (Plant and Machinery 39,50,000 34,60,000 Intangible - Goodwill 50,000 40,000 40,00,000 35,00,000 5. Current investments Marketable securities 10,000 30,000 Additional information: i) The debentures were issued on 01.04.2014
ii) Machinery costing Rs. 70,000 (accumulated depreciation thereon Rs. 10,000 was sold for Rs. 45,000. iii) Machinery costing Rs. 8,00,000 was purchased during the year iv) Dividend of Rs. 11,000 was paid during the year. (Ans:Cash flow from operating activities 5,36,000 Cash used in investing activities 7,65,000 Cash flow from financing activities 29,000 Hint: Marketable securities are part of cash and cash equivalents) Question 12.6
Question 12.7 Prepare cash flow statementof Delhi Ltd.,as on 31/03/2016 from the following two balance sheets. Particulars I. Equity and Liabilities Note. No. 31.03.2015 31.03.2016
1.Shareholders Funds 1 6,00,000 12,40,000 Reserves and Surplus 2 4,00,000 4,60,000 2. Non- Current Liabilities Long Term Borrowings 3 7,70,000 3,80,000 3. Non -Current Liabilities Short Term Borrowings 4 80,000 60,000 Trades Payables 30,000 20,000 Short Term Provisions 5 20,000 40,000 TOTAL 19,00,000 22,00,000 II. Assets 1. Non- Current Assets Fixed Assets 10,90,000 14,30,000 Non- Current Investments 30,000 70,000 2. Current Assets Short-term Investments 1,80,000 2,60,000 Inventories 2,40,000 2,40,000 Trade Receivables 2,60,000 1,30,000 Cash 80,000 40,000 Other Current Assets 20,000 30,000 TOTAL 19,00,000 22,00,000 Notes1. Shareholders Funds 31.03.2015 31.03.2016 Equity Share Capital 4,00,000 9,00,000 10% Preference Share Capital 2,00,000 3,40,000 total 6,00,000 12,40,000 2.Reserves and Surplus 31.03.2015 31.03.2016 Balance of Statement of Profit & Loss Account 2,40,000 2,80,000 General Reserve 1,60,000 1,80,000 TOTAL 4,00,000 4,60,000 3.Long Term Borrowings 31.03.2015 31.03.2016 10% Debentures 7,70,000 3,80,000 4.Short Term Borrowings
31.03.2015 31.03.2016 Bank overdraft 20,000 10,000 Cash credit 60,000 50,000 TOTAL 80,000 60,000 5.Short Term provisions 31.03.2015 31.03.2016 Proposed dividend 12,000 25,000 Provision for Tax 8,000 15,000 20,000 40,000 Additional Information: (i) Depreciation charged on Fixed Assets Rs.1,90,000.(ii) Tax paid during the year Rs.40,000. (iii) Interim dividend paid during the year Rs.45,000. (iv)debentures are redeemed on 31 st March, 2016 Question 12.8 (ISC 2013) Prepare a cash flow statement from the following information. Arthur reported a profit of Rs 90,000/- for the year ended March 12, 2012 after considering the following : a. Tax provided during the year 3,000 b. Amortization of goodwill 12,000 c. Profit on sale on land 5,000 d. Writing of preliminary expenses 2,000 e. Machinery costing Rs 40,000/- (accumulated depreciation thereon being Rs 18,000/-) was sold during the year at a loss of Rs 17,000/-. Extract of its balance sheet at the beginning and at the end of the year are given below. 01.04.2011 31.03.2012 Accounts receivable 16,000 20,000 Stock 15,000 12,000 Cash at bank 10,000 8,000 Accounts payable 11,000 9,000
Expenses payable 5,000 6,000 Provision for taxation 6,000 4,000 Investments (short term) 2,000 5,000 Plant and machinery (net value) 1,30,000 94,000 Proposed dividend 10,000 12,000 You are required to calculate Cash from Operating Activities as per Accounting Standards-3 (show your working clearly) Question 12.9 Prepare cash flow statement of Terrace Infra Ltd.,as on 31/03/2014 from the following two balance sheets. Particulars Note 31.03.2013 31.03.2014 I. Equity and Liabilities 1.Shareholders Funds 1 4,00,000 7,50,000 Reserves and Surplus 2 2,00,000 2,70,000 2. Non- Current Liabilities Long Term Borrowings 3 3,50,000 3,80,000 3. Current Liabilities Short Term Borrowings 4 80,000 40,000 Trades Payables 37,000 20,000 Short Term Provisions 5 33,000 40,000 TOTAL 11,00,000 15,00,000 II. Assets 1. Non- Current Assets Fixed Assets 4,90,000 8,30,000 Non- Current 50,000 60,000 2. Current Assets Short-term Investments 80,000 2,90,000 Inventories 2,50,000 2,30,000 Trade Receivables 1,60,000 60,000 Cash 60,000 25,000 Other Current Assets 10,000 5,000 TOTAL 11,00,000 15,00,000 Notes 1. Shareholders Funds 31.03.2013 31.03.2014 Equity Share Capital 3,00,000 6,00,000
Preference Share Capital 1,00,000 1,50,000 total 4,00,000 7,50,000 2.Reserves and Surplus 31.03.2013 31.03.2014 Balance of Statement of 1,60,000 2,10,000 Profit & Loss Account General Reserve 40,000 60,000 TOTAL 2,00,000 2,70,000 3. Long Term Borrowings 31.03.2013 31.03.2014 10% Debentures 3,50,000 3,80,000 4.Short Term Borrowings 31.03.2013 31.03.2014 Bank overdraft 60,000 30,000 Cash credit 20,000 10,000 TOTAL 80,000 40,000 5.Short Term provisions 31.03.2013 31.03.2014 Proposed dividend 15,000 30,000 Provision for Tax 18,000 10,000 33,000 40,000 Additional Information: (i) Depreciation charged on Fixed Assets Rs.90,000.(ii) Tax paid during the year Rs.30,000. (iii) Interim dividend paid during the year Rs.35,000. Question 12.10 Ktd industries gives you the following information for the year ending 31 st March 2016: a) Net profit before tax Rs. 13,80,000 b) Closing inventory was higher than opening inventory by Rs. 43,000 c) Trade creditors on 31 st March, 2016 exceeded those on 31 st March 2015 by Rs. 23,000 d) Tax paid amounted to Rs. 7,00,000
e) Depreciation charged for the year was Rs. 3,15,000. Outstanding expense on 31 st March 2015 and 2016 totaled 82,000 and 91,000 respectively. f. New machinery and furniture costing Rs. 10,27,500 in all were purchased g) An issue was made of 20,000 equity shares of Rs. 25 each at a premium of Rs. 7.7 per share. The entire amount was received with application. h) Dividends totaling Rs. 4,07,000 were paid. i) Cash in hand and cash at bank as on 31 st march 2015 totaled Rs. 2,13,800 ii) Company had investment worth Rs. 3,00,000 on 31 st March 2015, whereas on 31 st March 2016 it was 2,80,000. During the year investment costing 80,000 were sold at a profit of 20%. You are required to prepare a cash flow statement as per AS-3 (Revised) Question 12.11 Prepare cash flow statement from the following balance sheets. Particulars Note. No. 31.03.2016 31.03.2015 EQUITY AND LIABILITIES 1. Shareholders fund a) Share capital 1,60,000 1,20,000 b) Reserve and surplus 1 1,68,000 1,44,000 2. Non current liabilities Long term borrowings 2 1,00,000 2,00,000 3. Current liabilities a) Trade payable 96,000 88,000 b) Short term provisions 3 56,000 40,000 TOTAL 5,80,000 5,92,000 ASSETS 1. Non current assets a) Fixed assets : i) Tangible 4 3,24,000 3,84,000 ii) Intangible 5 16,000 24,000 b) Non current investments 24,000 16,000 2. Current assets a) Inventories 96,000 80,000 b) Trade receivables 1,12,000 83,200 c) Cash and cash equivalents 8,000 4,800 TOTAL 5,80,000 5,92,000
Notes to Accounts 31.03.2016 31.03.2015 1 Reserve and surplus General reserve 64,000 48,000 Surplus. Ie, Balance P&L account 1,04,000 96,000 1,68,000 1,44,000 2 Long erm borrowings 8% Debenture 1,00,000 2,00,000 3 Short term provisions Provision for tax 24,000 16,000 Proposed dividend 32,000 24,000 56,000 40,000 4 Tangible assets Land and building 1,44,000 1,20,000 Plant and machinery 80,000 64,000 2,24,000 1,84,000 5 Intangible assets (Goodwill) 16,000 24,000 Additional information: 1. Depreciation on plant and machinery Rs. 48,000 was charged during the year. During the year a plant, the cost which was Rs. 32,000 was sold for Rs. 24,000. The written down value of the plant was Rs. 16,000. 2. A piece of land was purchased in the year 2015-16 at Rs. 32,000 and depreciation of building Rs. 8,000 was charged during the year. 3. During the year dividend of Rs. 36,000 was paid and dividend Rs. 4,000 received on investments. 4. Tax paid during the year 2015-16 Rs. 28,000. Question 12.12 From the following Balance Sheet of Computer India Ltd., prepare cash flow statement. Not e No. 31.03.201 6 31.03.2015 Particulars EQUITY AND LIABILITIES Sahreholders funds a) Share capital 40,000 32,000
b) Reserve and surplus 1 20,800 11,200 Non current liabilities a) Long term borrowings (Loan) 9,600 16,000 Current liabilities a) Trade payable 7,200 8,800 b) Short term provision 2 34,400 21,600 TOTAL 1,12,000 1,12,000 ASSETS Non current assets a) Fixed assets 60,000 48,000 b) Investments 7,200 5,600 Current assets a) Inventories 18,400 16,000 b) Trade receivable 19,200 15,200 c) Cash and cash equivalents 7,200 4,800 TOTAL 1,12,000 1,12,000 31.03.201 6 31.03.201 5 Notes to accounts: 1. Reserve and surplus Security premium 4,000 General reserve 14,400 12,800 Surplus ie, Balance in P and L account 2,400 (1,600) 20800 11,200 2. Short term provisions Provision for taxation 18,400 9,600 Proposed dividend 16,000 12,000 34,400 21,600 Other information: a) Depreciation charged during the year Rs. 8,000 b) A fixed asset whose book value was Rs. 12,000, was sold for 14,400 c) During the year income tax and dividend paid Rs. 11,200 and Rs. 12,000 respectively. d) Rs. 1,600 was paid as loan interest and Rs. 3,200 was received as interest on investments during the year. Prepare cash flow statement. Question 12.13 The following is the balance sheet of DP consultants ltd, Prepare the cash flow statement as per AS -3 ( Revised) Particulars Not e 31.03.2015 31.03.2016
I. EQUITY AND LIABILITIES : 1. Share holders fund (a) Share capital (b) Reserves and surplus 2. Non current liabilities Long term borrowings (10% Debenture) 3. Current liabilities (a) Short term borrowing (Band overdraft ) (b) Trade payable (c ) Short term provision (Provision for tax) II. ASSETS : 1. Non current assets (a) Fixed assts (Tangible) (b) 10% non current investments 2. Current assets (a) Current investments (b) Trade receivable (c ) Cash and cash equivalents (d) Other current assets (Underwriting commission) Notes to accounts : 1. Share capital Equity share capital 12% Preference share capital 2. Reserve and surplus Statement of profit and loss General reserve 3. Fixed assets (Tangible ) Less: Accumulated depreciation 4. Cash and cash equivalents Cash in hand Cash at bank No. 1 2 5,00,000 2,50,000 2,00,000 4,00,000 1,10,000 1,25,000 12,000 15,000 18,000 11,000 83,000 11,000 TOTAL 9,95,000 7,40,000 3 8,60,000 50,000 6,10,000 30,000 14,000 ------ 61,000 80,000 4 10,000 12,000 ------- 8,000 TOTAL 9,95,000 7,40,000 Additional information: i. Dividend paid Rs. 5,000 ii. Fresh debentures were issued on 31 st March 2015 iii. Investments were purchased on 1 st October 2014 iii. Current investments includes Rs. 4,000 marketable securities Prepare cash flow statement of Ajmal ltd. from the following balance sheet. 3,50,000 2,00,000 1,50,000 2,00,000 5,00,000 4,00,000 1,50,000 1,00,000 10,10,000 (1,50,000) 1,00,000 10,000 7,10,000 (1,00,000) 8,000 4,000 2,000 8,000 10,000 12,000
Question 12.14 Prepare cash flow statement from the following balance sheets of Birla Ltd. Balance sheet Particulars Note 000 No. 31.03.2016 NOTES 1. Reserve and surplus General reserve 200 150 Surplus ie, Balance in statement of profit and loss 100 60 300 210 2. Fixed assets - Tangible Building 600 400 Machinery 700 500 1,300 900 Additional information: 1. Building still under construction and no depreciation was charged. 2. Depreciation was charged @ 25% on the opening value of Machinery. 3. An old machine costing Rs. 50,000 was sold for Rs. 35,000 (WDV Rs. 20,000) 4. Income tax paid during the year Rs. 50,000 000 31.03.2015 EQUITY AND LIABILITIES 1. Share holders fund a) Share capital 1,000 800 b) Reserve and surplus 1 300 210 2. Non current liabilities a) Long term borrowings (10% debentures ) 200.. 3. Current liabilities a) Trade payable 700 820 b) Short term provisions (Provision for taxation) 300 170 TOTAL 2,500 2,000 ASSETS 1. Non current assets a) Fixed assets- Tangible 2 1,300 900 b) Investments 100. 2. Current assets a) Inventories 400 200 b) Trade receivables 500 700 c) Cash and cash equivalents 200 200 TOTAL 2,500 2,000
5. Debentures were issued on 1 st October 2015 at a discount of 10% and the amount of discount had written off to the statement of profit and loss account. 6. Dividend received on investments Rs. 8,000. Prepare Cash flow statement as per AS-3. Question 12.15 (ISC 2015) You are required to prepare a cash flow statement (as per AS-3) for the year 2013-14 from the following Balance Sheets. Particulars I II 1. 2. 2 3 1 Note No. EQUITY AND LIABILITIES Shareholder s funds (a) Share capital (Equity share capital) (b) Reserve and surplus (Statement of P&L) Non current liabilities (a) Long term borrowing Current liabilities (a) Short term borrowings (Bank loan) (b) Trade payable (c )Short term provisions 1 31.03.2014 6,00,000 2,00,000 1,00,000 31.03.2013 4,00,000 1,00,000 2,00,000 --- 45,000 1,30,000 10,000 60,000 1,20,000 TOTAL 10,75,000 8,90,000 ASSETS Non current assets a) Fixed assets (i) Tangible assets (Building) (ii) Intangible assets (Patents) b) Non current investments Current aasets a) Inventories b) Trade receivables (Debtors) d) Cash and cash equivalents 6,00,000 45,000 75,000 15,000 2,55,000 85,000 6,00,000 50,000 ------- 10,000 2,00,000 30,000 TOTAL 10,75,000 10,75,000 Notes to accounts: Particulars 31.03.2014 1 Short term provisions Proposed dividend Provision for taxation 60,000 70,000 31.03.2013 80,000 40,000 Additional information: During the year 2013-14
(i) Building costing 75,000 was purchased. (ii) An old building, The book value of which was Rs. 63,000, was sold at loss of 5,000. (iii) Tax provided during this year was 80,000 Question 12.16 (ISC 2016) You are required to prepare a cash flow statement (as per AS 3) for the year 2014-15 from the following balance sheets: PARTICULARS NOTE NO. 31.03.201 5 I. EQUITY AND LIABILITIES 1. Shareholders funds 3,00,000 (a) Share capital (Equity share capital) (b) Reserve and surplus (Statement of P/L) 1,20,000 2. Non current liabilities (a) Long term borrowings (8% Debenture) 1,50,000 3. Current liabilities (a) Short term borrowings (Bank overdraft) 19,000 (b) Trade payable (Creditors) 31,000 (c) Short term provisions 1 1,30,000 II. ASSETS 1. Non current assets (a) Fixed assets Tangible (b) Non current investments 2. Current assets (a) Inventories (b) Trade receivable (c) Cash and bank balance 31.03.2014 2,00,000 70,000 1,20,000 5,000 20,000 1,20,000 TOTAL 7,50,000 5,35,000 2 2,04,200 1,30,000 1,83,000 1,20,000 1,41,500 1,25,000 3 62,600 62,900 2,11,700 44,100 TOTAL 7,50,000 5,35,000 Notes to accounts PARTICULARS 31.03.2015 31.03.2014 1. Short term provisions Proposed dividend 50,000 60,000 Provision for taxation 80,000 60,000 2. Fixed assets (Tangible) Plant and machinery Less: Accumulated depreciation 1,30,000 1,20,000 2,43,000 2,23,000 (38,800) (40,000) 2,04,200 1,83,000
3. Trade receivable Debtors Less: Provision for doubtful debts Additional information : 64,600 64,500 (2,000) (1,600) 62,600 62,900 (i) A part of machine was sold for Rs. 21,000 at a profit of Rs. 4,000 (ii) The company charged depreciation Rs. 3,000 on its plant and machinery. (iii) New debentures were issued on 31 st December 2015 at a discount of 10% (iv) Interest of Rs. 9,600 was paid on debentures. (Ans: Operating 1,23,400 ; Investing 11,000 ; Financing 57,400) Question 12.17 Given below is the extract from Balance sheets of ABC ltd. Particulars 31.03.2015 31.03.2016 Building at cost 10,00,000 16,00,000 Provision for depreciation 3,00,000 5,00,000 During the year a part of building costing 3,00,000 on which accumulated depreciation was 1,00,000 was sold for Rs. 2,50,000. You are required to calculate: a) Amount of building purchased b) Depreciation charged for the year c) Profit/ loss on sale of building d) State how each of the items related to building will be shown in the cash flow statement.