CBSE Class 12 Accountancy Chapter 14 Important Questions – Free PDF Download
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CBSE Class 12 Accountancy Important Questions Chapter 14 Cashflow statement
1: X Ltd. Made a profit of Rs. 1,00,000 after considering the following items:
1. Depreciation of fixed assets Rs. 20,000
2. Writing off preliminary expenses Rs. 10,000
3. Loss on sale of furniture Rs. 1,000
4. Provision of Taxation Rs. 1,60,000
5. Transfer to General reserve Rs. 14,000
6. Profit on sale of Machinery Rs. 6,000
The following additional information is available to you:
| Particulars | 31.03.2014 Rs. | 31.03.2015 Rs. |
| Debtors Creditors Bills Receivables Bill Payables Prepaid Expenses | 24,000 20,000 20,000 16,000 400 | 30,000 30,000 17,000 12,000 600 |
Calculate Cash Flow from Operating Activities.
Solution :
Calculation of Net Profit before Tax and Extra-ordinary items:
Net Profit (Given) Rs. 1,00,000
Add: Provision for Taxation Rs. 1,60,000
Transfer to general reserve Rs. 14,000
Net Profit before Tax and Extra-ordinary item Rs. 2,74,000
2: From the following information calculate cash flow from investing activities:
| Particulars | 31.03.2014 Rs. | 31.03.2015 Rs. |
| Machinery (at Cost) Accumulated Depreciation Patents Goodwill Investment | 5,00,000 1,00,000 2,00,000 1,50,000 2,50,000 | 5,50,000 1,20,000 1,20,000 1,00,000 5,00,000 |
Additional Information
(i) During the year, a machine costing Rs. 50,000 with its accumulated depreciation of Rs. 25,000 was sold for Rs. 20,000.
(ii) Patents were written off to the extent of Rs. 60,000 and some patents were sold at a profit of Rs. 10,000.
(iii) 40% of the investments held in the beginning of the year were sold at 10% Profit.
(iv) Interest received on investment Rs. 25,500.
(v) Dividend received on investment Rs. 8,500.
(vi) Rent received Rs. 5,000.
Solution :
| Particulars | Rs. |
| Proceeds from sale of machinery Proceeds from sale of investment Proceeds from sale of Patents Cash paid purchase of Machinery Cash paid purchase of Investment Interest Received Rent Received Net Cash Used in Investing activities | 20,000 1,10,000 30,000 (1,00,000) (3,50,000) 25,500 8,500 5,000 |
| (2,51,000) |
Working Notes :
Investment Account
| Date | Particulars | Rs. | Date | Particulars | Rs. |
| To Balance b/d To Profit on sale of investment A/c To Back A/c (Additional Purchase) | 2,50,000 10,000 3,50,000 | By Bank A/c (Sale of investment) By Balance c/d | 1,10,000 5,00,000 | ||
| 6,10,000 | 6,10,000 |
Machinery Account (at original cost)
| Date | Particulars | Rs. | Date | Particulars | Rs. |
| To Balance b/d To Back A/c (Additional Purchase) | 5,00,000 1,00,000 | By Bank A/c (Sale of investment) By Pro for Depreciation A/c (Dep. On Machinery sold) By Loss on sale of Machinery A/c By Balance c/d | 20,000 25,000 5,000 5,50,000 | ||
| 6,00,000 | 6,00,000 |
Provision for Depreciation Account
| Date | Particulars | Rs. | Date | Particulars | Rs. |
| To Machinery A/c (Total Depreciation on Machinery sold) To balance c/d | 25,000 1,20,000 | By Balance b/d By Statement of Profit & loss (Depreciation charged on machinery during the current year) | 1,00,000 45,000 | ||
| 1,45,000 | 1,45,000 |
Patents Account
| Date | Particulars | Rs. | Date | Particulars | Rs. |
| To Balance b/d To Profit on sale of patents A/c | 2,00,000 10,000 | By Bank A/c (B/F – Sale of Patents) By Statement of Profit & Loss (Written off) By Balance c/d | 30,000 60,000 1,20,000 | ||
| 2,10,000 | 2,10,000 |
3: From the following information, calculate the net cash flow from Financing Activities:
| Particulars | 31.03.2014 Rs. | 31.03.2015 Rs. |
| Equity Share Capital 9% Debentures Proposed Dividend Dividend Payable 10% Preference Share Capital | 10,00,000 1,50,000 3,00,000 ………… 2,00,000 | 16,00,000 1,00,000 3,50,000 50,000 3,00,000 |
Additional Information
1. Interest paid on Debentures Rs.12,500.
2. During the year 2014-2015, company issued bonus shares to equity shareholders in the ratio of 2:1 by capitalizing reserve.
3. The interim dividend of Rs. 75,000 has been paid during the year.
4. 9% Debentures were redeemed as 5% premium.
Solution :
Cash Flow from Financing Activities
| Particulars | 31.03.2015 Rs. |
| Proceeds from Issue of Equity Share Capital Proceeds from Issue of 10% Preference Share Capital Cash paid for Redemption of 9% Debentures  Interest paid on Debentures Interim Dividend paid Final Dividend paid (3,00,000-50,000) Net Cash Used in Financing Activities) | 1,00,000 1,00,000 (52,500) (12,500) (75,000) (2,50,000) |
| 1,90,000 |
4: From the following Balance Sheets of X Ltd. As on 31.03.2014 and 31.03.2015. Prepare a cash flow statement.
Balance Sheet as at 31st March, 2014 and 2015
| Particulars | Note No. | Figure as at the end of 31.3.2014 (Rs.) | Figure as at the end of 31.3.2014 (Rs.) |
| 1. EQUITY AND LIABILITIES Shareholders’ funds (a) Share capital (b) Reserves and surplus Current liabilities Trade payables Total | 45,000 25,000 8,700 | 65,000 42,500 11,000 | |
| 78,700 | 1,18,500 | ||
| II. ASSETS (1)Non-current assets (a)Fixed assets (i) Tangible Assets (2)Current Assets Inventories Trade receivables Cash and cash equivalents Total | 46,700 11,000 18,000 3,000 | 83,000 13,000 19,500 3,000 | |
| 78,700 | 1,18,500 |
Note to Accounts
| Particulars | Figure as at the end of 31.3.2014 (Rs.) | Figure as at the end of 31.3.2014 (Rs.) |
| Note No. 1. Reserve and Surplus: General Reserve Balance in Statement of P&L A/c Total | 15,000 10,000 | 27,500 15,000 |
| 25,000 | 42,500 |
Additional Information :
(i) Depreciation on fixed assets for the year 2014-15 was Rs. 14,700.
(ii) An interim divided Rs. 7,000 has been paid to the shareholders during the year.
Solution :
| Calculation of Net Profit before Tax and Extraordinary item: Net Profit as per Balance in Statement of Profit & Loss A/c (15000 – 1,000) Add : Transfer to General Reserve (27,500 -15,5000) Add : Interim dividend paid during the year Net Profit before Tax-and Extraordinary item | Rs. 5,000 12,500 7,000 |
| 24,500 |
Cash Flow Statement
For the year ended 31st March 2015
| Particulars | Details Rs. | Amounts Rs. | |
| A. Cash flow from operating activities Net Profit Before Tax and Extra-ordinary Item Adjustment for non-cash and non-operating items Add : Depreciation on fixed assets Operating Profit before working capital changes Adjustment for Working Capital Changes Add : Increase in Trade Payables Less : Increase in trade receivable Increase in Inventories Net Cash Inflow from Operating Activities B. Cash Flow from Investing Activities Purchase of Fixed Assets Net Cash Used in Investing Activities C. Cash Flow From Financing Activities Issue of share capital Payment of interim dividend Cash Flow from Financing Activities Net Increase in Cash & Cash equivalent Add : Cash & Cash Equivalent at the beginning of year Cash & Cash Equivalent at the end of year | 24,500 14,700 | 38,000 (51,000) 13,000 | |
| 39,200 2,300 | |||
| 41,500 (1,500) (2,000) | |||
| (51,000) | |||
| 20,000 (7,000) | |||
| NI 3,000 | |||
| 3,000 |
Fixed Assets Account
| Date | Particulars | Rs. | Date | Particulars | Rs. |
| To Balance b/d To Back A/c (Additional Purchase) | 46,700 51,000 | By Depreciation A/c (Current year dep. On remaining fixed assets) By Balance c/d | 14,700 83,000 | ||
| 97,700 | 97,700 |
5: Prepare a Cash Statement on the basis of the information given in the Balance Sheet of Live Ltd. As at 31.03.2015 and 31.03.2014:
| Particulars | Note No. | 31.3.2014 (Rs.) | 31.3.2014 (Rs.) |
| 1. EQUITY AND LIABILITIES (1) Shareholders’ funds (a) Share capital (b) Reserves and surplus (2) Non-current Liabilities (a) Long term-borrowings (3) Current liabilities (a) Trade payables Total | 2,10,000 1,32,000 1,50,000 75,000 | 1,80,000 24,000 1,50,000 27,000 | |
| 5,67,000 | 3,81,000 | ||
| II. ASSETS (1) Non-current assets (a) Fixed assets (i) Tangible Assets (b) Non-current Investments (2) Current Assets (a) Current-Investments (Marketable) (b) Inventories (c) Trade receivables (d) Cash and cash equivalents Total | 2,94,000 48,000 54,000 1,07,000 40,000 24,000 | 2,52,000 18,000 60,000 24,000 17,500 9,500 | |
| 5,67,000 | 3,81,000 |
Notes to Accounts:
Note – 1
| Particulars | 2015 (Rs.) | 2014 (Rs.) |
| Reserve and Surplus Surplus (Balance in Statement of Profit and Loss) | 1,32,000 | 24,000 |
Solution :
Cash Flow Statement
For the year ended 31st March 2015
| Particulars | Details Rs. | Amounts Rs. | |
| Cash flow from operating activities Net Profit Before Tax and Extra-ordinary Item Add : Non cash and Non-operating charges Operating Profit before working capital changes Add : Increase in Current Liabilities Increase in trade payables Less : Increase in Current Assets Increase in trade receivables Increase in inventories Cash generated from Operating Activities Cash Flow from Investing Activities Purchase of Fixed Assets Purchase of noncurrent investments Cash Used in Investing Activities. Cash Flow From Financing Activities Issue of share capital Cash Flow from Financing Activities Net Increase in Cash & Cash equivalent Add : Opening balance of cash & cash equivalents : Marketable Securities Cash & Cash Equivalent Closing balance of cash & cash equivalent Marketable Securities Cash & Cash Equivalent | 1,08,000 – | 50,500 (72,000) 30,000 | |
| 1,08,000 48,000 | |||
| 1,56,000 (22,500) (83,000) | |||
| (42,000) (30,000) | |||
| 30,000 60,000 9,500 | |||
| 8,500 69,500 | |||
| 54,000 24,000 | |||
| 78,000 |
6: From the following information, Complete the Cash flow Statement of RK Ltd.
Cash Flow Statement
For the year ended on 31st March 2015
| Particulars | Rs. | Rs. | |
| A. Cash flow from operating activities Net Profit Before Tax and Extra-ordinary Item Adjustment for non-cash and non-operating items Depreciation Loss on sale of Machinery Operating Profit before working capital changes Adjustment for charges in working Capital Capital Decrease in Trade Payables Increase in Inventory Cash generated from operation before tax and extraordinary items Less : Increase tax paid Net cash flow from operating activities B. Cash Flow from Investing Activities Purchase of Fixed Assets Sale of Machinery Net cash flow from Investing Activities C. Cash Flow From Financing Activities Proceeds from Issue of share Net cash flow from Financing Activities (A+B+C) Net Increase in Cash & Cash equivalent during the year Add : Cash & Cash Equivalent at the beginning of the period Cash & Cash Equivalent at the end of the period | ……….. ……….. ……….. | ……….. ……….. ……….. | |
| ……….. (8,000) (………..) | |||
| 50,000 (………..) | |||
| (………..) ……….. | |||
| ……….. | |||
| ……….. | |||
| ……….. |
Note to Accounts
| Particulars | 31.3.2014 (Rs.) | 31.3.2014 (Rs.) |
| Note 1. Reserve and Surplus: General Reserve Balance in Statement of P&L Note 2. Cash and Cash Equivalents Cash at Cash Note 3. Short term Provisions Provision for Taxation | 55,000 70,000 | 40,000 50,000 |
| 1,25,000 | 90,000 | |
| 52,000 | 37,000 | |
| 52,000 | 37,000 | |
| 25,000 | 20,000 | |
| 25,000 | 20,000 |
Additional Information:
(1) Depreciation charges on Building for the3 year 2014-15 was Rs. 10,000.
(2) During the year 2014-15, machinery of Rs. 1,38,000 was purchased.
(3) A part of machinery costing Rs. 20,000 with accumulated depreciation of Rs 6,500 was sold for Rs. 8,500.
(4) Income tax paid during the year 2014-15 was Rs. 18,000.
Solution:
Cash Flow Statement
For the year ended 31-3-2015
| Particulars | Rs. | Rs. | |
| A. Cash flow from operating activities Net Profit Before Tax and Extra-ordinary Item Adjustment for non-cash and non-operating items Depreciation Loss on sale of Machinery Operating Profit before working capital changes Adjustment for charges in working Capital Decrease in Trade Payables Increase in Inventory Cash generated from operation before tax and extraordinary items Less : Increase tax paid Net cash flow from operating activities B. Cash Flow from Investing Activities Purchase of Fixed Assets Sale of Machinery Net cash flow from Investing Activities C. Cash Flow From Financing Activities Proceeds from Issue of share Net cash flow from Financing Activities (A+B+C) Net Increase in Cash & Cash equivalent during the year Add: Cash & Cash Equivalent at the beginning of the period Cash & Cash Equivalent at the end of the period | 58,000 10,000 5,000 | 32,000 (1,29,500) 1,12,500 | |
| 73,000 (8,000) (15,000) | |||
| 50,000 (18,000) | |||
| (1,38,000) 8,5000 | |||
| 1,12,500 | |||
| 15,000 37,000 | |||
| 52,000 |
Working Notes
1. Calculation of Net Profit before tax and extraordinary items :-
Rs.
Difference in Balance in statement of P&L (70,000-50,000) 20,000
Add : Transfer to General Reserve15,000
Provision for Taxation23,000
58,000
2. Provision for Taxation Account
| Particulars | Rs. | Particulars | Rs. |
| To Balance b/d (Tax Paid) To Back A/c | 18,000 25,000 | By Balance b/d By Statement of P&L (Balancing Figure – Provision mad during the year) | 20,000 23,000 |
| 43,000 | 43,000 |
