Question

15. Calculate Cash from operating Activities from the following information: Operating Profit (atter provision for tax * 43,000) Depreciation19000 Operating Expenses Paid58000 Income Tax Paid 33000Refund of tax received 3000 Interest on debentures Paid 11.000 Ans,=* 1,20,000 ​

Answer 1

Answer:

8000

Explanation:

Operating activities means cash generated/ spend from/ for operations and not from investing or financing activities.

first we take the profir after tax, then add back all non cash expenses like depreciation and provision and deduct the cash payment.

profit after tax 43000

add, depreciation 9000

less. tax paid (33,000)

interest paid (11,000)

Cash generated from operations is 8000

payment of operationg expenses will not impact as the profit after tax is already accounted for the operating expense payments