Balance Sheet of XYZ Ltd as on 31‐Mar‐2015 and 31‐Mar‐2016
31.03.15 31.03.16 31.03.15 31.03.16
Liabilities Rs in 000 Rs in 000 Assets Rs in 000 Rs in 000
Share Capital 1440 1920 Fixed Assets 3840 4560
Capital Reserve 48 Less: Depreciation 1104 1392
General Reserve 816 960 2736 3168
Profit & Loss Account 288 360 Investments 480 384
9% Debenture 960 672 Cash 210 312
Current Liabilities 576 624 Other Current assets (including stock) 1134 1272
Proposed Dividend 144 174 Preliminary Expenses 96 48
Provision for Tax 432 408
Unpaid Dividend 18
4656 5184 4656 5184
Additional Information
1. During the year 2015 ‐ 2016, Fixed Assets with a book value of Rs 2,40,000 (accumulated depreciation Rs 84,000) was sold for Rs 1,20,000
2. Provided Rs 4,20,000 as depreciation
3. Some investments are sold at a profit of Rs 48,000 and the Profit was credited to Capital Reserve
4. It was decided that stocks be valued at cost, whereas previously the practice was to value stock at cost less 10 percent. The stock was Rs 2,59,200 as on 31.03.2015. The stock as at 31.03.16 was correctly valued at Rs 3,60,000
5. It was decided to write off Fixed Assets costing Rs 60,000 on which depreciation amounting to Rs 48,000 has been provided.
6. Debentures are redeemed at Rs 105
Answers
Answer:
Cash Flow Statement for the year ended 31.3.2017
Particulars
Details
Amount
Net profit during year
1,25,000
Add: Provision for tax
1,25,000
Proposed dividend
75,000
2,00,000
Net profit before tax and extra-ordinary items
3,25,000
Adjustment of non-operating and non-cash items:
Add: Accumulated depreciation
62,500
Interest on debenture (WN-1)
15,000
77,500
Operating profit before working capital changes
4,02,500
Add: Increase in current liabilities and decrease in current assets
Less: Decrease in CL and increase in CA
Trade receivables
-50,000
Short term loans and advances
-1,00,000
Cash generated from operation
2,52,500
Less: Income tax
-75,000
A: Cash flow from operating activities
1,77,500
Machinery purchased
-2,12,500
B: Cash used in investing activities
-2,12,500
Proceeds from issue of debenture
1,00,000
Proposed dividend
-,50,000
Interest on debenture
-15,000
Issue of bank loan
50,000
C: Cash flow from financing activities
85,000
Net increase in cash and cash equivalents (A+B+C)
50,000
Add: Opening cash and cash equivalents
75,000
Closing cash and cash equivalents
1,25,000
Working note:
(a) Interest on debenture = 1,50,000 X 10 = Rs. 15,000
100