1. From the following information, prepare a Cash Flow Statement for the year ended 31st March 2022:
- Net profit for the year: Rs. 5,00,000
- Depreciation charged during the year: Rs. 2,00,000
- Preliminary expenses written off: Rs. 50,000
- Interest paid during the year: Rs. 1,00,000
- Dividend received during the year: Rs. 50,000
- Proceeds from sale of machinery: Rs. 3,00,000
- Purchase of new machinery: Rs. 4,00,000
- Increase in trade payables: Rs. 1,00,000
- Decrease in inventories: Rs. 50,000
Solution: Cash Flow Statement for the year ended 31st March 2022:
Cash Flows from Operating Activities:
Net Profit before tax and extraordinary items Rs. 5,50,000
Adjustments for:
Depreciation charged during the year Rs. 2,00,000
Preliminary expenses written off Rs. 50,000
Operating profit before working capital changes Rs. 7,00,000
Adjustments for:
Increase in trade payables Rs. 1,00,000
Decrease in inventories Rs. 50,000
Operating cash flows before taxes and extraordinary items Rs. 8,50,000
Direct taxes paid Rs. 1,00,000
Cash Flows from Operating Activities Rs. 7,50,000
Cash Flows from Investing Activities:
Proceeds from sale of machinery Rs. 3,00,000
Purchase of new machinery Rs. 4,00,000
Cash Flows from Investing Activities (Rs. 1,00,000)
Cash Flows from Financing Activities:
Dividend received during the year Rs. 50,000
Cash Flows from Financing Activities Rs. 50,000
Net Increase in Cash and Cash Equivalents Rs. 7,00,000
Cash and Cash Equivalents as on 31st March 2021 Rs. 0
Cash and Cash Equivalents as on 31st March 2022 Rs. 7,00,000
2. From the following Balance Sheets of XYZ Ltd., prepare a Cash Flow Statement for the year ended 31st March 2022:
Balance Sheet as on 31st March 2022
Liabilities Rs. Assets Rs.
Equity Share Capital 10,00,000 Fixed Assets 20,00,000
General Reserve 5,00,000 Investments 5,00,000
Long-term Borrowings 10,00,000 Inventory 2,00,000
Trade Payables 2,00,000 Debtors 1,50,000
Short-term Borrowings 3,00,000 Cash & Bank Balances 2,00,000
Provisions 50,000
Balance Sheet as on 31st March 2021
Liabilities Rs. Assets Rs.
Equity Share Capital 5,00,000 Fixed Assets 15,00,000
General Reserve 2,50,000 Investments 3,00,000
Long-term Borrowings 5,00,000 Inventory 1,50,000
Trade Payables 1,00,000 Debtors 50,000
Short-term Borrowings 2,00,000 Cash & Bank Balances 1,50,000
Provisions 25,000
Solution: Cash Flow Statement for the year ended 31st March 2022:
Cash Flows from Operating Activities:
Net Profit before tax and extraordinary items Rs. 5,50,000
Adjustments for:
Depreciation charged during the year Rs. 5,00,000
Operating profit before working capital changes Rs. 10,50,000
Adjustments for:
Decrease in inventories Rs. 50,000
Increase in debtors Rs. 1,00,000
Increase in trade payables Rs. 1,00,000
Operating cash flows before taxes and extraordinary items Rs. 12,00,000
Direct taxes paid Rs. 1,50,000
Cash Flows from Operating Activities Rs. 10,50,000
Cash Flows from Investing Activities:
Purchase of Fixed Assets Rs. 5,00,000
Sale of Investments Rs. 2,00,000
Cash Flows from Investing Activities (Rs. 3,00,000)
Cash Flows from Financing Activities:
Proceeds from Long-term borrowings Rs. 5,00,000
Proceeds from Issue of Equity Share Capital Rs. 5,00,000
Cash Flows from Financing Activities Rs. 10,00,000
Net Increase in Cash and Cash Equivalents Rs. 7,50,000
Cash and Cash Equivalents as on 31st March 2021 Rs. 1,50,000
Cash and Cash Equivalents as on 31st March 2022 Rs. 9,00,000
3. From the following information, prepare Cash Flow Statement for the year ended 31st March 2022:
- Net profit before tax and extraordinary items Rs. 4,00,000
- Depreciation charged during the year Rs. 1,50,000
- Provision for taxation for the year Rs. 1,00,000
- Dividend paid during the year Rs. 1,50,000
- Loss on sale of machinery Rs. 50,000
- Increase in inventories Rs. 1,20,000
- Decrease in debtors Rs. 80,000
- Increase in trade payables Rs. 50,000
Solution: Cash Flow Statement for the year ended 31st March 2022:
Cash Flows from Operating Activities:
Net Profit before tax and extraordinary items Rs. 4,00,000
Adjustments for:
Depreciation charged during the year Rs. 1,50,000
Loss on sale of machinery Rs. 50,000
Operating profit before working capital changes Rs. 6,00,000
Adjustments for:
Increase in inventories Rs. 1,20,000
Decrease in debtors Rs. 80,000
Increase in trade payables Rs. 50,000
Operating cash flows before taxes and extraordinary items Rs. 7,50,000
Direct taxes paid Rs. 1,00,000
Cash Flows from Operating Activities Rs. 6,50,000
Cash Flows from Investing Activities:
Sale of Machinery Rs. 0 (no proceeds mentioned)
Cash Flows from Investing Activities Rs. 0
Cash Flows from Financing Activities:
Dividend paid during the year Rs. 1,50,000
Cash Flows from Financing Activities (Rs. 1,50,000)
Net Increase in Cash and Cash Equivalents Rs. 5,00,000
Cash and Cash Equivalents as on 31st March 2021 Rs. 1,50,000
Cash and Cash Equivalents as on 31st March 2022 Rs. 6,50,000
Class 12 CBSE Board Accountancy Cash Flow Statement: Practical Questions with Solutions
Class 12
CBSE Board
Accountancy
Cash Flow Statement
Practical Questions
Solutions
Net Profit
Depreciation
Provision for Taxation
Dividend
Sale of Machinery
Increase in Inventories
Decrease in Debtors
Increase in Trade Payables
Proceeds from Issue of Equity Share Capital
Redemption of Debentures
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