1 of 22

PREPARATION OF CASH FLOW STATEMENT

CLASS XII

2 of 22

PREPARATION OF CASH FLOW STATEMENT

Particulars	Note No.	31.3.2018 ₹	31.3.2017 ₹
I. EQUITY AND LIABILITIES: Shareholders Funds: (a) Share Capital (b) Reserve and Surplus	1.	3,00,000 54,000	2,00,000 40,000
2) Non-Current Liabilities Long-term Borrowings	2.	95,000	50,000
(3) Current Liabilities (a) Trade Payables (b) Other Current Liabilities	3.	90,000 35,000	75,000 25,000
TOTAL		5,74,000	3,90,000

From the following Balance Sheets of Aruna Sugars Ltd., you are required to prepare a statement of Cash-Flow :-

3 of 22

PREPARATION OF CASH FLOW STATEMENT

Particulars	Note No.	31.3.2018 ₹	31.3.2017 ₹
II. ASSETS : Non-Current Assets: (a) Fixed Assets:
Tangible Assets Intangible Assets	4. 5.	1,70,000 67,000	90,000 1,05,000
(b) Long-term Investments		65,000	40,000
2) Current Assets :
(a) Current Investments	6.	15,000	10,000
(b) Inventory		90,000	50,000
(c) Trade Receivables		1,20,000	50,000
(d) Cash and Bank Balances		39,000	35,000
(e) Other Current Assets	7.	8,000	10,000
		5,74,000	3,90,000

From the following Balance Sheets of Aruna Sugars Ltd., you are required to prepare a statement of Cash-Flow :-

4 of 22

PREPARATION OF CASH FLOW STATEMENT

Notes : (1) Reserve and Surplus :	31.3.2018 ₹	31.3.2017 ₹
Security Premium Reserve Surplus ie., Balance in Statement of P& L	6,000 48,000	----- 40,000
	54,000 ______________	40,000 ______________
2) Long-term Borrowings: Public Deposits	95,000 ______________	50,000 _____________
(3) Other Current Liabilities: Outstanding Expenses	35,000 ______________	25,000 _____________
(4) Tangible Assets: Land & Buildings	1,70,000 _______________	90,000 _____________

From the following Balance Sheets of Aruna Sugars Ltd., you are required to prepare a statement of Cash-Flow :-

5 of 22

PREPARATION OF CASH FLOW STATEMENT

	31.3.2018 ₹	31.3.2017 ₹
(5) Intangible Assets : Goodwill Patents	60,000 7,000 ___________ 67,000 _______________	90,000 15,000 ____________ 1,05,000 _____________
(6) Current Investments : Marketable Securities	15,000 ______________	10,000 ____________
(7) Other Current Assets : Prepaid Expenses	8,000 ____________	10,000 _____________

From the following Balance Sheets of Aruna Sugars Ltd., you are required to prepare a statement of Cash-Flow :-

6 of 22

Additional Information :

Interest paid on public desposits amounted to ₹9,000.
On 1^st April, 2017, 10,000 shares of ₹10 each were issued at 6% premium.

7 of 22

Particulars	₹	₹
A. Cash Flows from Operating Activities :
Net Profit before Tax (Note 1)	8,000
Adjustments for non-cash and non- operating items:
Add: Goodwill written off Patents written off Interest Paid	30,000 8,000 9,000
Operating profit before working capital changes	55,000
Add: Decrease in Current Assets : Prepaid Expenses 2,000

CASH FLOW STATEMENT

For the year ending 31^st March, 2019

8 of 22

Particulars	₹	₹
Add: Increase in Current Liabilities
Trade Payables 15,000 Outstanding Expenses 10,000 ________	27,000 _________ 82,000
Less: Increase in Current Assets: Inventory 40,000 Trade Receivables 70,000 __________ Net cash used in operating activities	1,10,000 ____________ 28,000 ___________	(28,000)
B. Cash flows from Investing Activities : Purchase of Land & Buildings Purchase of Long-term Investments Net cash used in investing acitivities	(80,000) (25,000) ___________ (1,05,000) ____________	(1,05,000)

9 of 22

Particulars	₹	₹
C. Cash flow from Financing Activities : Proceeds from Issue of Share Capital (₹1,00,000 + ₹6,000) Proceeds from Public Deposits Interest Paid Net cash from financing activities	1,06,000 45,000 (9,000) ___________ (1,42,000) ____________	1,42,000
Net Increase in cash and cash equivalents Add: Cash and cash equivalents in the beginning of the period.		9,000 45,000
Cash and cash equivalents at the end of the period		54,000 _____________

10 of 22

CASH FLOW STATEMENT�

For the year ended 31^st March, 2018

Notes: (1) Calculation of Net Profit before Tax

Surplus of Statement of Profit & Loss on 31st March, 2018

Less Surplus of Statement of Profit & Loss on 31st March, 2017

(2) Cash and Cash Equivalents:

₹

Cash and Bank Balances

Marketable Securities

39,000 35,000

15,000 10,000

54,000 45,000

_______ ______

31-3-2018

48,000

40,000

8,000

_______

31-3-2018

₹

11 of 22

DCX LTD. �BALANCE SHEET AS AT 31^ST MARCH, 2018

Particulars	Note No.	31.3.2018 ₹	31.3.2017 ₹
I. EQUITY AND LIABILITIES: Shareholders Funds: (a) Share Capital (b) Reserve and Surplus	1.	30,00,000 4,00,000	21,00,000 5,00,000
2) Non-Current Liabilities : Long-term Borrowings	2.	8,00,000	5,00,000
(3) Current Liabilities: (a) Trade Payables (b) Other Current Liabilities	3.	1,50,000 76,000	1,00,000 56,000
TOTAL		44,26,000	32,56,000

From the following Balance Sheets of DCX Ltd., and the additional information as at 31^st March, 2018 prepare a Cash Flow Statement

12 of 22

PREPARATION OF CASH FLOW STATEMENT

Particulars	Note No.	31.3.2018 ₹	31.3.2017 ₹
II. ASSETS : Non-Current Assets: (a) Fixed Assets:
Tangible Assets Intangible Assets	4.	27,00,000 8,00,000	20,00,000 7,00,000
(b) Long-term Investments		65,000	40,000
2) Current Assets :
(a) Current Investments	6.	89,000	78,000
(b) Inventory		8,00,000	4,00,000
(d) Cash and Bank Balances		37,000	78,000
		44,26,000 _____________	32,56,000 ____________

From the following Balance Sheets of Aruna Sugars Ltd., you are required to prepare a statement of Cash-Flow :-

13 of 22

Notes : Particulars (1) Reserve and Surplus :	31.3.2018 ₹	31.3.2017 ₹
Surplus ie., Balance in the Statement of P& L	4,00,000	5,00,000
	54,000 ______________	40,000 ______________
2) Long-term Borrowings: 8% Debentures	8,00,000 ______________	5,00,000 _____________
(3) Short term Provisions: Provision for Tax	76,000 ______________	56,000 _____________
(4) Tangible Assets: Machinery Less : Accumulated Depreciation	33,00,000 (6,00,000) 27,00,000 _______________	90,000 (5,00,000) 20,00,000 ___________

Notes to

Account:

14 of 22

Additional Information :

During the year a machinery costing ₹8,00,000 on which accumulated depreciation was ₹3,20,000 was sold for ₹6,40,000
Debentures were issued on 1^st April, 2019.

15 of 22

Particulars	₹	₹
A. Cash Flows from Operating Activities :
Net Profit before Tax (Note 1)	(24,000)
Adjustments for non-cash and non- operating items:
Add: Depreciation on Machinery Add: Interest on Debentures (8% on ₹8,00,000) Less: Gain on sale of machinery	4,20,000 64,000 (1,60,000)
Operating profit before working capital changes	3,00,000
Add: Increase in Trade Payables Less: Increase in Inventories Cash used in operating activities before tax Less: Tax paid Net Cash used in Operating Activities	50,000 (4,00,000) (50,000) (56,000) (1,06,000)	(1,06,000)

CASH FLOW STATEMENT

For the year ending 31^st March, 2019

16 of 22

Particulars	₹	₹
B. Cash flows from Investing Activities : Purchase of Machinery Purchase of Intangible Assets Sale of Machinery Net cash used in investing activities	(16,00,000) (1,00,000) 6,40,000 ___________ (10,60,000) ____________	(10,60,000)

17 of 22

Particulars	₹	₹
C. Cash flow from Financing Activities : Issue of Share Capital Issue of Debentures Interest Paid on Debentures Cash Inflows from financing activities	9,00,000 3,00,000 (64,000) ___________ (11,36,000) ____________	11,36,000
Net Increase in cash and cash equivalents Add: Opening Balance of Cash and cash equivalents		(30,000) 1,56,000
Closing Balance of Cash and cash equivalents		1,26,000 _____________

18 of 22

Notes: (1) Calculation of Net Profit before Tax

Net profit for the year: 5,00,000 – 4,00,000

Add: Provision for tax for current year

Net Profit before tax

(1,00,000)

76,000

24,000

_______

19 of 22

	₹		₹
To Balance b/d	25,00,000	By Bank A/c	6,40,000
To Gain on Sale	1,60,000
		By Accumulated Depreciation A/c (Dep. on machinery sold)	3,20,000
To Bank A/c (balancing figure, being purchase of machinery)	16,00,000	By Balance c/d	33,00,000
	42,60,000 __________		42,60,000 __________

(2)

MACHINERY ACCOUNT

20 of 22

	₹		₹
To Machinery A/c	3,20,000	By Balance b/d	5,00,000
By Balance c/d	6,00,000	By Statement of Profit and Loss A/c (balancing figure, being current year's depreciation)	4,20,000
	9,20,000 __________		9,20,000 __________

(3)

ACCUMULATED DEPRECIATION ACCOUNT

21 of 22

(4) Cash and Cash Equivalents

	31.3.2018 ₹	31.3.2017 ₹
Current Investments	89,000	78,000
Cash and bank Balance	37,000	78,000

22 of 22

THANK YOU!