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Question No 24 Chapter 8 – UNIMAX Class 12 Part 2 – 2021
24.from the following information, calculate net cash flow from operating activities and investing activities:
| Particulars | 31.3.2021 ₹ | 31.3.2022 ₹ |
| Profit and loss A/c | 1,00,000 | 4,00,000 |
| Provision for tax | 30,000 | 30,000 |
| Trade payable | 40,000 | 1,50,000 |
| Current assets (inventories & trade receivables) | 4,60,000 | 5,20,000 |
| Fixed assets | 8,50,000 | 9,32,000 |
| Accumulated depreciation | 4,25,000 | 4,40,000 |
Additional information:
A machine has a book value 40,000 (depreciation provided thereon 65,0000 was sold at a loss of 8,000. Tax paid during the year was 30,000.
The solution of Question No 24 Chapter 8 – UNIMAX Class 12 Part 2 – 2021: –
Calculation of cash from Operating Activities and Investing Activities
| Particulars | ₹ | |
| (i)cash flow from operating activities | ||
| (A)net profit before tax | 3,30,000 | |
| (B)add: depreciation | 80,000 | |
| Loss on sale of machinery | 8,000 | |
| Operating profit before working capital changes | 4,18,000 | |
| Changes in current assets & current liabilities: | ||
| Less: increase in current assets | (60,000) | |
| Add: increase in trade payables | 1,10,000 | 50,000 |
| Net cash flow from operating activities before tax | 4,68,000 | |
| Less: tax paid | (30,000) | |
| Net cash inflow operating activities after tax | 4,38,000 | |
| ii. cash flow from investing activities | ||
| Sale of machinery | 32,000 | |
| Purchase of fixed assets | (1,87,000) | |
| Net cash used in investing activities | 1,55,000 | |
Working notes:
| 1. Calculation of net profit before tax | |
| Closing balance of P& L a/c | 4,00,000 |
| Less: opening balance of P & l a/c | (1,00,000) |
| Add: tax | 30,000 |
| Net profit before tax | 3,30,000 |
2 .
Fixed assets account (at cost)
| Particulars | ₹ | Particulars | ₹ |
| To balance b/d | 8,50,000 | By balance b/d | 1,05,000 |
| To bank a/c (purchase) (B. fig) | 1,87,000 | By balance c/d | 9,32,000 |
| 10,37,000 | 10,37,000 |
3 .
Provision for depreciation account
| Particulars | ₹ | Particulars | ₹ |
| To assets disposal A/c | 65,000 | By balance b/d | 4,25,000 |
| To balance c/d | 4,40,000 | By P& L A/c (B. fig.) | |
| (dep. provided during the current year | 80,000 | ||
| 5,05,000 | 5,05,000 |
4.
Asset’s disposal account
| Particulars | ₹ | Particulars | ₹ |
| To fixed assets A/c | 1,05,000 | By provision for depreciation | 65,000 |
| By bank A/c (sale proceeds B. fig.) | 32,000 | ||
| By P& L A/c (loss on sale | 8,000 | ||
| 1,05,000 | 1,05,000 |
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