Tuesday, February 27, 2018

AHSEC - Class 12: Cash Flow Statement Practical Problems

Cash flow statement practical problems
1. From the following information, calculate net cash flows from operating activities:
Particulars
2015 (Rs.)
2016 (Rs.)
Profit and Loss Account
Preliminary Expenses
Outstanding Salaries
Sundry Debtors
Stock in Hand
Sundry Creditors
Prepaid Expenses
Bills Payable
Bills Receivable
Income Received in Advance
1,20,000
20,000
4,000
40,000
90,000
30,000
6,000
30,000
60,000
6,000
1,40,000
15,000
5,000
50,000
60,000
40,000
8,000
20,000
50,000
4,000
2. From the following information calculate cash from operations:
                     i.            Profits made during the year 2016, Rs. 3,00,000 after considering the following items:
a)      Income from investments Rs. 6,000.
b)      Goodwill written off Rs. 4,000.

c)       Transferred to General Reserve Rs. 10,000.
d)      Depreciation on fixed assets Rs. 20,000.
e)      Provision for bad debts Rs. 6,000.
                   ii.            The following is the position of current assets and current liabilities:
Particulars
2015(Rs.)
2016(Rs.)
Stock
Sundry Debtors
Bills Receivable
Bills Payable
Sundry Creditors
Outstanding Expenses
Prepaid Rent
60,000
30,000
15,000
20,000
40,000
10,000
6,000
50,000
35,000
10,000
25,000
45,000
12,000
10,000
3. From the following information calculate net cash flows from operating activities:
                     i.            Loss incurred during the year 2010 Rs. 10,000 after considering the following items:
a)      Depreciation on machinery Rs. 15,000.
b)      Goodwill written off Rs. 10,000.
c)       Loss on sale of plant Rs. 5,000.
d)      Profit on sale of land Rs. 8,000.
e)      Provision for likely bad debts Rs. 1,000.
       ii.            The following is the position of current assets and current liabilities:
Particulars
2009(Rs.)
2010(Rs.)
Stock
Marketable Securities
Accrued Income
Sundry Debtors
Sundry Creditors
Bills Receivable
Bills Payable
Provision for Bad Debt
Bank Overdraft
80,000
60,000
10,000
40,000
60,000
40,000
20,000
2,000
20,000
90,000
40,000
6,000
50,000
65,000
35,000
25,000
3,000
25,000
4. Calculate net cash flows from operating activities from the following:
Profit and Loss Account for the year ended 31st March, 2010
Particulars
Rs.
Particulars
Rs.
To Salaries
To Rent
To Depreciation
To Loss on Sale of Plant
To Goodwill written off
To Proposed Dividends
To Provision for Taxation
To Net Profit
15,000
10,000
2,000
1,000
4,000
5,000
5,000
11,000
By Gross Profit
By Profit on Sale of Land
By Income Tax Refund
45,000
4,000
4,000

53,000

53,000
5. Calculate the Cash Flow from Operating Activities from the following information:

Net income for the year ended 31st March, 2013
Annual Depreciation
Profit on sale of furniture which was transferred to Statement of Profit and Loss
Trade Receivable (Increase in Debtors)
Trade Payables (Increase in Creditors)
Rs.
15,00,000
6,00,000
1,50,000
1,20,000
1,80,000
6. Compute Cash Flow from Operating Activities from the following:
Particulars
1st April, 2012
31st March, 2013
Balance in Statement of Profit and Loss
Trade Receivables:
        Bills Receivable
        Debtors
Inventories (Stock)
Prepaid Expenses
Trade Payables:
        Creditors
        Bills Payable
Outstanding Expenses
Provision for bad debt
40,000

5,000
10,000
7,000
500

4,000
1,000
2,000
2,000
80,000

8,000
12,000
4,000
-

6,000
-
3,000
1,500
7. From the following you are required to calculate Cash Flow from Operating Activities:
Particulars
31st March, 2012
31st March, 2013
Balance in Statement of Profit and Loss
Trade Receivables:
        Debtors
        Bills Receivable
General Reserve
Dividend Equalization Fund
Salary Outstanding
Wages Prepaid
Goodwill
60,000

87,000
62,000
2,02,000
78,000
30,000
5,000
80,000
65,000

40,000
1,03,000
2,37,000
1,00,000
12,000
7,000
70,000
8. Ascertain Cash Flows from operating activities under the Direct Method from the Following data Related to the accounting year 2010 – 11   
Total sales: 44,000 (Cash Rs 4,000, Credit Rs 40,000)
Cash received from customers: 35,000
Closing Account Receivables: 8,000
Cash paid to Suppliers: 42,000
Cash paid to employees: 7,000
Furniture purchased from (M/s. Decorators on credit): 9,000
Income tax paid: 3,000
Donation paid: 1,000
Office expenses, total Rs 6,000, paid: 3,000
9. From the following information, calculate cash flow from operating activities using Direct Method:                     
Particulars (Dr.)
Amount
Particulars (Cr.)
Amount
To Cost of goods sold
To Gross Profit c/d

To Salary
To Insurance
To Depreciation
To Income Tax
To Net Profit
130000
70000
By Sales


By Gross Profit b/d
200000
200000
200000
20000
2000
5000
8000
35000
70000

70000

70000
Additional Information:
(1)    Debtors – Opening Balance Rs.15000, Closing Balance Rs.20000.
(2)    Creditors – Opening Balance Rs.10000, Closing Balance Rs.12000.
(3)    Stock – Opening Balance Rs.7000, Closing Balance Rs.10000.
(4)    At the end of the year, outstanding salary Rs.2000 pre-paid insurance Rs.400 and Income tax outstanding Rs.1000.
10. From the following summarized Cash Book of ABC Ltd. prepare a Cash Flow Statement for the year ended 31st December, 2010 in accordance with AS – 3 (Revised).
Summarized Cash Book
Date
Particulars
Rs.
Date
Particulars
Rs.
2010
Jan. 1
To Balance b/d
To Collection from Sundry Debtors
To Issue of Preference Shares
To Sale of Land
10,000
5,00,000
3,00,000
1,90,000
2010
By Purchase of Machinery
By Payment to Suppliers
By Wages
By Rent, Rates and Taxes
By Income Tax
By Redemption of Debentures
By Dividends
By Balance c/d
2,00,000
4,00,000
30,000
20,000
25,000
2,75,000
30,000
20,000


10,00,000


10,00,000
11. From the following information, calculate Cash Flow from Investing Activities:

Purchase of Machine
Purchase of Goodwill
Sale of Machine
Sale of Investment
Rs.
2,50,000
1,00,000
35,000
50,000

Purchase of Investments
Sale of Patents
Interest and Dividend Received

Rs.
1,50,000
40,000
10,000
A building was purchased as investment out of surplus which was let out for commercial purpose. Rent received     Rs. 20,000.                 
12. From the following information, calculate Cash Flow from Investing Activities:
Particulars
31st March, 2012 (Rs.)
31st March, 2013(Rs.)
Plant and Machinery
Investment (Long-term)
Land (At cost)
8,50,000
40,000
2,00,000
10,00,000
1,00,000
1,00,000
Additional Information:
1.       Depreciation charged on Plant & Machinery Rs. 50,000.
2.       Plant & Machinery with a Book Value of Rs. 60,000 was sold for Rs. 40,000.
3.       Land was sold at a profit of Rs. 60,000.
4.       No Investment was sold during the year.
13. From the following details, calculate cash from Investing and Financing Activities:                      5
Particulars
1-4-2014
31-3-2015
Machinery at Cost
Accumulated Depreciation
Capital
Bank Loan
60,000
15,000
45,000
15,000
75,000
18,000
52,500
---
During the year, machinery costing Rs. 15,000/- was sold at a loss of Rs. 3,000. Depreciation on machinery charges during the year amounted to Rs. 9,000.
14. From the following information, calculate Cash Flow from Investing and Financing Activities:
Particulars
1st April, 2012 (Rs.)
31st March, 2013(Rs.)
Machinery (At Cost)
Accumulated Depreciation
Capital
Bank Loan
40,000
10,000
30,000
10,000
50,000
12,000
35,000
-
During the year, a machine costing Rs. 10,000 was sold at a loss of Rs. 2,000. Depreciation on machinery charged during the year amounted to Rs. 6,000.
15. From the following information, calculate the Net Cash Flow from Investing Activities:
Particulars
31st March, 2012 (Rs.)
31st March, 2013(Rs.)
Machinery (At Cost)
Accumulated Depreciation
5,00,000
1,00,000
5,50,000
1,70,000
During the year 2011-12, a machine costing Rs. 50,000 (accumulated depreciation Rs. 20,000) was sold for Rs. 26,000.
16. From the following information, calculate the Net Cash Flow from Financing Activities:
Particulars
31st March, 2012 (Rs.)
31st March, 2013(Rs.)
Equity Share Capital
Preference Share Capital
Securities Premium Reserve
12% Debentures
9,00,000
1,00,000
2,50,000
1,50,000
10,00,000
50,000
2,60,000
1,00,000
Additional Information: Interest paid on debentures Rs. 18,000. Bonus shares issued during the year Rs. 50,000. Premium paid on redemption of debentures 10%.
17. From the following particulars, calculate the Cash Flow from Investing Activities:
Particulars
Purchased
Sold
Machinery
Investments
Goodwill
Patents
6,20,000
2,40,000
1,00,000
-
2,00,000
80,000
-
1,50,000
Additional Information:
1)      Interest received on debentures held as investment Rs. 8,000.
2)      Interest paid on debentures issued Rs. 20,000.
3)      Dividend received on shares held as investment Rs. 20,000.
4)      Dividend paid on equity share capital Rs. 30,000.
5)      A plot of land was purchased out of the surplus funds for investment purpose and was let out for commercial use. Rent received Rs. 50,000 during the year.
18. Balance Sheets of A Ltd. as at 31.3.2010 and 31.3.2011 were as follows:
Liabilities
31.3.2010
31.3.2011
Assets
31.3.2010
31.3.2011
Share Capital
General Reserve
Profit and Loss Account
Secured Loans
Sundry Creditors
Income Tax Provision
50,000
5,000
41,000
20,000
10,000
20,000
60,000
8,000
33,000
25,000
12,000
17,000
Fixed Assets
Stock
Debtors
Cash/Bank
Preliminary Expenses
90,000
20,000
30,000
4,000
2,000
1,00,000
24,000
25,000
5,000
1,000

1,46,000
1,55,000

1,46,000
1,55,000

Additional Information – Depreciation written off on fixed assets was Rs. 18,000.