Question : Source : Textbook / Reference Book of the course
From the following Balance Sheet of ABC Ltd as at 31.3.2018 and
31.3.2017; Prepare the cash ow statement
Note 31.03.2018 31.03.2017
no.
Equity and Liabilities
Shareholders Funds
Share Capital 7,00,000 5,00,000
Reserves and Surplus 3,50,000 2,00,000
Non Current Liabilities 50,000 1,00,000
Long Term Borrowings
Current Liabilities
Trade Payables 1,22,000 1,05,000
Short Term Provisions (Provision for Tax) 50,000 30,000
12,72,000 9,35,000
Assets
Non Current Assets
Fixed Assets
Tangible Assets 1 5,00,000 5,00,000
Intangible Assets 2 95,000 1,00,000
Non Current Investments 1,00,000 0
Current Assets
Inventory 1,30,000 55,000
Trade Receivables 1,47,000 80,000
Cash and Cash Equivalents 3,00,000 2,00,000
12,72,000 9,35,000
Notes to Accounts
1 Tangible Assets
Machinery 2,80,000 2,00,000
Accumulated Depreciation -1,00,000 -80,000
1,80,000 1,20,000
Equipment 3,20,000 3,80,000
2 Intangible Assets
Goodwill 95,000 1,00,000
Additional Information:
Machinery of the book value of Rs. 80,000 (accumulated
depreciation Rs. 20,000) was sold at a loss of Rs. 18,000.
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Answer to Cash Flow Problem
Cash Flow from Operating
Pro t before Tax 2,00,000
Add Non Cash Items
Depreciation 40,000
Adjust for nancing or investing activities
Loss on sale of assets 18,000
Goodwill amortised 5,000
Adjust Changes in Working Capital
Increase in trade payables 17,000
Increase in inventory -75,000
Increase in trade receivable -67,000
1,38,000
Less Tax Paid -30,000
1,08,000 Operating activities
- In ow
Cash Flow from Investing
Working notes prepared for assets
Purchase of asset -1,60,000
Sale of asset 42,000
Sale of equipment 60,000
Purchase of non current investments -1,00,000
-1,58,000 Investing activities -
out ow
Cash Flow from Financing
Issue of share capital 2,00,000
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Long term Borrowings - Repayment -50,000
1,50,000 Financing activities
- in ow
Total movement across 3 activities 1,00,000
Add Cash and cash equivalents at the 2,00,000
beginning
Cash and Cash equivalents at the end 3,00,000
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Working Notes
1 Pro t
Pro t is the
di erence between
the reserves of 2
years.
Reserves and 3,50,000
Surplus - Current
Year
Less Reserves and 2,00,000
Surplus Last year
Pro t for the year 1,50,000
Add : Provision for 50,000
tax for this year
2,00,000
2 Machinery Machinery
Opening Balance 2,00,000 Asset Disposal 80000
Purchase of new 160000
asset (Bad g) -
(investing)
Closing Balance 2,80,000
360000 360000
Accumulated Accumulated Depreciation
Depreciation
Asset Disposal 20000 Opening Balance 80,000
Depreciation during 40000
the year -
Balancing gure
(non cash)
Closing Balance 1,00,000
120000 120000
Asset Disposal Assets Disposal
Machinery 80000 Accumulated 20000
depreciation
Cash (investing) 42000
Pro t and Loss A/c 18000
80000 80000
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Computation of
Cash Received on
Sale of Machinery
WDV of sold 60000
Machinery - Cost -
Accumulate
depreciation
Loss -18000
Cash received 42000
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