MANAGEMENT ACCOUNTING
CASH FLOW STATEMENT
1. The summarised Balance Sheets of Krishna Glass Ltd. as on 31st December, 2015 and 31st December, 2016
are given below :
31.12.2015 31.12.2016 31.12.2015 31.12.2016
LIABILITIES ASSETS
AMOUNT (₹) AMOUNT (₹) AMOUNT (₹) AMOUNT (₹)
Share Capital 2,25,000 3,00,000 Goodwill 40,000 20,000
Plant & Machinery
General Reserves 1,50,000 1,75,000 2,00,000 2,80,000
(Net)
Profit & Loss A/c 28,000 39,000 Investment 60,000 1,10,000
Creditors 84,000 67,000 Stock 1,50,000 1,20,000
Mortgage Loan NIL 1,24,000 Debtors 50,000 1,15,000
Provision for Tax 33,000 25,000 Prepaid Expenses 15,000 5,000
Bank 5,000 80,000
5,20,000 7,30,000 5,20,000 7,30,000
During 2016, Plant & Machinery costing ₹ 35,000 (depreciation charged ₹ 18,000)
INFORMATION :
(i) were sold at a loss of ₹ 3,000 . Depreciation charged on Plant & Machinery was
ADDITIONAL
₹ 25,000 in 2016;
Investment worth ₹ 10,000 became obsolete and during the year it was written – off to
(ii)
General Reserves;
(iii) A dividend of ₹ 20,000 was paid on 30.09.2016;
(iv) Provision for Tax made during 2016 was ₹ 28,000 .
You are required to prepare a Cash Flow Statement of the company for the year ended 31st December, 2016.
Trading Profit ₹ 1,42,000
Cash from Operations ₹ 1,00,000
CASH FLOW STATEMENT (TOTAL) : 000000
By showing Cash from Operations ₹ 3,18,000
ANSWER
By NOT showing Cash from Operations ₹ 4,00,000
AS PER NEW FORMAT (AS – 3) : 000000
Net Cash Flow from OPERATING ACTIVITIES ₹ 64,000
Net cash Flow from INVESTING ACTIVITIES ( ₹ - 1,68,000 )
Net Cash Flow from FINANCING ACTIVITIES ₹ 1,79,000
Net increase in Cash & Bank Balance ₹ 75,000
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, 2. From the following information, prepare a Cash Flow Statement for the year ended 31.12.2016 (making
necessary assumptions) :
Balance Sheets as at 31.12.2015 and 31.12.2016 :
31.12.2015 31.12.2016 31.12.2015 31.12.2016
LIABILITIES ASSETS
AMOUNT (₹) AMOUNT (₹) AMOUNT (₹) AMOUNT (₹)
Capital 3,00,000 3,50,000 Land & Building 2,20,000 3,00,000
Bank Overdraft 3,20,000 2,0,000 Machinery 4,00,000 2,80,000
Bills Payable 1,00,000 80,000 Stock 1,00,000 90,000
Creditors 1,80,000 2,50,000 Debtors 1,40,000 1,60,000
Cash 40,000 50,000
9,00,000 8,80,000 9,00,000 8,80,000
ADDITIONAL INFORMATION :
(i) Net Profit for the year 2016 amounted to ₹ 1,20,000 ;
During the year a Machinery costing ₹ 50,000 (accumulated depreciation ₹ 20,000) was sold
(ii)
for ₹ 26,000 ;
The Provision for Depreciation against Machinery as on 31.12.2015 was ₹ 1,00,000 and
(iii)
on 31.12.2016 was ₹ 1,70,000 .
Trading Profit ₹ 2,14,000
Cash from Operations ₹ 2,54,000
CASH FLOW STATEMENT (TOTAL) : 000000
By showing Cash from Operations ₹ 3,20,000
ANSWER
By NOT showing Cash from Operations ₹ 3,60,000
AS PER NEW FORMAT (AS – 3) : 000000
Net Activities ( ₹ - 54,000 )
Net Cash Flow from Financing Activities ( ₹ - 70,000 )
Net increase in Cash & Bank Balance ₹ 1,30,000
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CASH FLOW STATEMENT
1. The summarised Balance Sheets of Krishna Glass Ltd. as on 31st December, 2015 and 31st December, 2016
are given below :
31.12.2015 31.12.2016 31.12.2015 31.12.2016
LIABILITIES ASSETS
AMOUNT (₹) AMOUNT (₹) AMOUNT (₹) AMOUNT (₹)
Share Capital 2,25,000 3,00,000 Goodwill 40,000 20,000
Plant & Machinery
General Reserves 1,50,000 1,75,000 2,00,000 2,80,000
(Net)
Profit & Loss A/c 28,000 39,000 Investment 60,000 1,10,000
Creditors 84,000 67,000 Stock 1,50,000 1,20,000
Mortgage Loan NIL 1,24,000 Debtors 50,000 1,15,000
Provision for Tax 33,000 25,000 Prepaid Expenses 15,000 5,000
Bank 5,000 80,000
5,20,000 7,30,000 5,20,000 7,30,000
During 2016, Plant & Machinery costing ₹ 35,000 (depreciation charged ₹ 18,000)
INFORMATION :
(i) were sold at a loss of ₹ 3,000 . Depreciation charged on Plant & Machinery was
ADDITIONAL
₹ 25,000 in 2016;
Investment worth ₹ 10,000 became obsolete and during the year it was written – off to
(ii)
General Reserves;
(iii) A dividend of ₹ 20,000 was paid on 30.09.2016;
(iv) Provision for Tax made during 2016 was ₹ 28,000 .
You are required to prepare a Cash Flow Statement of the company for the year ended 31st December, 2016.
Trading Profit ₹ 1,42,000
Cash from Operations ₹ 1,00,000
CASH FLOW STATEMENT (TOTAL) : 000000
By showing Cash from Operations ₹ 3,18,000
ANSWER
By NOT showing Cash from Operations ₹ 4,00,000
AS PER NEW FORMAT (AS – 3) : 000000
Net Cash Flow from OPERATING ACTIVITIES ₹ 64,000
Net cash Flow from INVESTING ACTIVITIES ( ₹ - 1,68,000 )
Net Cash Flow from FINANCING ACTIVITIES ₹ 1,79,000
Net increase in Cash & Bank Balance ₹ 75,000
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, 2. From the following information, prepare a Cash Flow Statement for the year ended 31.12.2016 (making
necessary assumptions) :
Balance Sheets as at 31.12.2015 and 31.12.2016 :
31.12.2015 31.12.2016 31.12.2015 31.12.2016
LIABILITIES ASSETS
AMOUNT (₹) AMOUNT (₹) AMOUNT (₹) AMOUNT (₹)
Capital 3,00,000 3,50,000 Land & Building 2,20,000 3,00,000
Bank Overdraft 3,20,000 2,0,000 Machinery 4,00,000 2,80,000
Bills Payable 1,00,000 80,000 Stock 1,00,000 90,000
Creditors 1,80,000 2,50,000 Debtors 1,40,000 1,60,000
Cash 40,000 50,000
9,00,000 8,80,000 9,00,000 8,80,000
ADDITIONAL INFORMATION :
(i) Net Profit for the year 2016 amounted to ₹ 1,20,000 ;
During the year a Machinery costing ₹ 50,000 (accumulated depreciation ₹ 20,000) was sold
(ii)
for ₹ 26,000 ;
The Provision for Depreciation against Machinery as on 31.12.2015 was ₹ 1,00,000 and
(iii)
on 31.12.2016 was ₹ 1,70,000 .
Trading Profit ₹ 2,14,000
Cash from Operations ₹ 2,54,000
CASH FLOW STATEMENT (TOTAL) : 000000
By showing Cash from Operations ₹ 3,20,000
ANSWER
By NOT showing Cash from Operations ₹ 3,60,000
AS PER NEW FORMAT (AS – 3) : 000000
Net Activities ( ₹ - 54,000 )
Net Cash Flow from Financing Activities ( ₹ - 70,000 )
Net increase in Cash & Bank Balance ₹ 1,30,000
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