Closing Bal P&L

Less: Opening Bal P&L

Ms. Jyoti of Star Oils Limited has collected the following Appropriation
information for the preparation of cash flow statement for the Amt Net Profit after tax
Net Profit 25,000 Add: Tax exp
Dividend paid 8,535
Provision for Income tax 5,000 Net Profit before tax & extra ordinary item
Income tax paid during the year 4,248 Reversal effect of non cash
Loss on sale of assets (net) 40 Depreciation
Book value of the assets sold 185 Effects for Increase in WC
Depreciation charged to the Statement of Profit and 20,000 Loss on sale of assets (net)
Loss
Profit on sale of Investments 100 Interest Exp
Carrying amount of Investment sold 27,765 Profit on sale of Investments
Interest income received on investments 2,506 Interest Received
Interest expenses of the year 10,000 Less: Income tax Paid
Interest paid during the year 10,520 Net operating CF
Increase in Working Capital (excluding Cash & Bank 56,081
Balance)
Purchase of Fixed assets 14,560 Investing
Investment in joint venture 3,850 Sale of investment
Expenditure on construction work in progress 34,740 Interest income received on investments
Proceeds from calls in arrear 2 Asset sold
Receipt of grant for capital projects 12 Purchase of FA
Proceeds from long-term borrowings 25,980 JV
Proceeds from short-term borrowings 20,575 Receipt of grant for capital projects
Opening cash and bank balance 5,003 Expenditure on construction work in progress
Closing cash and bank balance 6,988 Investing
Prepare the Cash Flow Statement for the year ended 31 March
20X1 in accordance with AS 3. Financing
Interest paid during the year
Proceeds from calls in arrear
Proceeds from long-term borrowings
Proceeds from short-term borrowings
Dividend paid
Financing

Cash generated during year

OPENING Cash
Closing Cash
 25000
5,000

30,000

20,000
-56,081
40
10,000 1000 Buy
-100 1200 Sale
-2,506 200 Profit
-4,248
-2,895

Cash A/c…Dr 1200 BS

To Investment 1000 BS
27,865 To Profit on sale of inv 200 P&L
2,506
145
-14,560
-3,850
12
-34,740
-22,622

-10,520
 2
25,980
20,575
-8,535
27,502

1,985
5,003
6,988

6988 0
Ryan Ltd provides you the following information at the year-end,
March 31, 20X1:
Rs. Rs.
Sales 698,000
Cost of Goods Sold (520,000)
178,000
Operating Expenses (including
(147,000)
Depreciation Expense of Rs. 37,000)
31,000
Other Income / (Expenses):
Interest Expense paid (23,000)
Interest Income received 6,000
Gain on Sale of Investments 12,000
Loss on Sale of Plant (3,000)
(8,000)
23,000
Income tax (7,000)
16,000
Information available:
31st March 31st March
20X1 20X0
Rs. Rs.
Plant 715,000 505,000
Less: Accumulated Depreciation (103,000) (68,000)
612,000 437,000
Investments (Long term) 115,000 127,000
Inventory 144,000 110,000
Trade receivables 47,000 55,000
Cash 46,000 15,000
Prepaid expenses 1,000 5,000
Share Capital 465,000 315,000
Reserves and surplus 140,000 132,000
Bonds 295,000 245,000
Trade payables 50000 43000
Outstanding liabilities 12000 9000
Income taxes payable 3000 5000
Analysis of selected accounts and transactions during 20X0-X1:
1. Purchased investments for Rs. 78,000.
2. Sold investments for Rs. 1,02,000. These investments cost Rs.
90,000.
3. Purchased plant assets for Rs. 1,20,000.
4. Sold plant assets that cost Rs.10,000 with accumulated depreciation of Rs. 2,000 for Rs. 5,000.
5. Issued Rs. 1,00,000 of bonds at face value in exchange for
plant assets on 31st March, 20X1.
6. Repaid Rs. 50,000 of bonds at face value at maturity.
7. Issued 15,000 shares of Rs. 10 each.
8. Paid cash dividends Rs. 8,000.
Prepare Cash Flow Statement as per AS-3 (Revised), using indirect
method.
The balance sheets of Sun Ltd. as at 31st March 20X1 and 20X0 were as:
Particulars Notes 20X1 20X0
Rs. Rs.
1 Equity and Liabilities
(a) Shareholder’s
Share capital funds 1 60,000 50,000
(b) Reserve & surplus 2 5,000 4,000
2 Current liabilities
(a) Trade Payables 4,000 2,500
(b) Other current liabilities 3 0 1,000
(c) Short term provision (provision for tax) 1,500 1,000
Total 70,500 58,500
Assets
1 Non-current assets
(a) Property, Plant & Equipment 4 39,500 29,000
2 Current assets
(a) Current investments 2,000 1000
(b) Inventories 17,000 14000
(c) Trade receivables 8,000 6,000
(d) Cash & cash equivalents 5 4,000 8,500
70,500 58,500
Notes to accounts

20X1 20X0
Rs. Rs.
1 Share Capital
Equity Shares of Rs.10 each 60,000 50,000
2 Reserve & surplus
Profit and Loss Account 5,000 4,000
3 Other current liabilities
Dividend Payable 0 1,000
Property, plant and equipment (at
4
WDV)
Building 10,000 10,000
Fixtures 17,000 11,000
 Vehicles 12,500 8,000
Total 39,500 29,000
5 Cash and cash equivalents
Cash and Bank 4,000 8,500
The profit and loss statement for the year ended 31st March, 20X1
disclosed:
Particulars Rs.
Profit before tax 4,500
Tax expense: Current tax (1,500)
Profit for the year 3,000
Declared dividend (2,000)
Retained Profit 1,000
Further information is available:
Fixtures Vehicles
Rs. Rs.
Depreciation for the year 1,000 2,500
Disposals:
Proceeds on disposal of vehicles 0 1,700
Written down value 0 -1000
Profit on disposal 700
Prepare a Cash Flow Statement for the year
ended 31st March, 20X1.
From the following information of Mr. Zen, prepare a Cash flow
statement as per AS- 3 for the year ended 31.3.20X1:
Ledger balances of Mr. Zen as of 20X0 and 20X1

As on As on 224,000
1.4.20X0
Rs. 1.4.20X1
Rs.
Zen’s Capital A/c 10,00,000 12,24,000 NP 360,000
Trade payables 3,20,000 3,52,000 Add : Depr 120,000
Mrs. Zen’s loan 2,00,000 0 Add: loss 16,000
Loan from Bank 320,000 400,000 ###
Land 6,00,000 8,80,000
Plant and Machinery 6,40,000 4,40,000 Trade P 32,000
Inventories 2,80,000 2,00,000 80,000
Trade receivables 2,40,000 4,00,000 -160,000
Cash 80,000 56,000 ###
Additional information:
A machine costing Rs. 80,000 (accumulated depreciation there on
Rs.24,000) was sold for Rs. 40,000. The provision for depreciation on
1.4.20X0 was Rs. 2,00,000 and 31.3.20X1 was Rs. 3,20,000. The net
profit for the year ended on 31.3.20X1 was Rs. 3,60,000

Invest
land -280,000
machin -80,000
###
760000
840000 finance 80,000
-80000
-200,000
###

-32,000
Op 80,000
48,000
Cl 56,000
-8,000
88000

56
From the following Balance sheet of Grow More Ltd., prepare Cash Flow
Statement for the year ended 31st March, 20X1 :
Particulars Notes 31st March, 31st
Equity and Liabilities 20X1 March,
1 Shareholders’ funds
A Share capital 1,000,000 800,000
B Reserves and Surplus 1 #VALUE! #VALUE!
2 Non-current liabilities
Long term borrowings 2 200,000 -
3 Current liabilities
A Trade Payables 700,000 820,000
B Other current liabilities 3 - 100,000
C Short term provision (provision for 100,000 70,000
tax) Total #VALUE! #VALUE!
Assets
1 Non-current assets
A Property, plant and Equipment 4 1,300,000 900,000
B Non-Current Investments 100,000 -
2 Current assets
A Inventories 400,000 200,000
B Trade receivables 500,000 700,000
C Cash and Cash equivalents - 200,000
Total 2,300,000 ###

Notes to accounts
No. Particulars 31st March, 31st
20X1 March,
20X0
1 Reserves and Surplus
Revenue reserve 2,00,000 1,50,000
Profit and Loss account 1,00,000 60,000
 Total #VALUE! #VALUE!
2 Long term borrowings
Debentures (issued at end of year) 200,000 0
3 Other current liabilities
Dividend payable 0 100,000
4 Property, plant and equipment
Plant and machinery 700,000 500,000
Land and building 600,000 400,000
Net carrying value 1,300,000 900,000
(i) Depreciation @ 25% was charged on the opening value of Plant
and Machinery.
(ii) At the year end, one old machine costing Rs. 50,000 (WDV Rs. 20,000)
was sold for Rs. 35,000. Purchase was also made at the year end.
(iii) Rs. 50,000 was paid towards Income tax during the year.
(iv) Construction of the building got completed on 31.03.20X1 and
hence no depreciation may be charged on the same.
Prepare Cash flow Statement.
From the following Balance Sheets and information, prepare Cash Flow Statement of
Ryan Ltd. by Indirect method for the year ended 31st March, 20X1:
Particulars Notes 31st March, 31st March,
20X1 20X0

Equity and Liabilities

1 Shareholders’ funds
A Share capital 1 6,00,000 7,00,000
B Reserves and Surplus 2 4,20,000 3,00,000
2 Non-current liabilities
Long term borrowings 3 2,00,000 -
3 Current liabilities
A Trade Payables 1,15,000 1,10,000
B Other current liabilities 4 30,000 80,000
C Short term provision (provision for 95,000 60,000
tax) Total 14,60,000 12,50,000
Assets
1 Non-current assets
A Property, plant and Equipment 5 9,15,000 7,00,000
B Non-Current Investments 50,000 80,000
2 Current assets
A Inventories 95,000 90,000
B Trade receivables 2,50,000 2,25,000
C Cash and Cash equivalents 50,000 90,000
D Other Current assets 1,00,000 65,000
Total 14,60,000 12,50,000

Notes to accounts
No 31st March, 31st March,
. 20X1 20X0
1 Share capital
Equity share capital 6,00,000 5,00,000
10% Redeemable Preference share -- 2,00,000
capital
Total 6,00,000 7,00,000
2 Reserves and Surplus
Capital redemption reserve 1,00,000 -
Capital reserve 70,000 -
General reserve 1,50,000 2,50,000
Profit and Loss account 1,00,000 50,000
Total 4,20,000 3,00,000
3 Long term borrowings
9% Debentures 2,00,000 --
4 Other current liabilities
Dividend payable - 60,000
Liabilities for expenses 30,000 20,000
Total 30,000 80,000
5 Property, plant and equipment
Plant and machinery 7,65,000 5,00,000
Land and building 1,50,000 2,00,000
Net carrying value 9,15,000 7,00,000
Additional Information:
(i) A piece of land has been sold out for Rs.1,50,000 (Cost – Rs.1,20,000) and the balance land
was revalued. Capital Reserve consisted of profit on revaluation of land.
(ii) On 1st April, 20X0 a plant was sold for Rs.90,000 (Original Cost – Rs.70,000 and W.D.V. – Rs.
50,000) and Debentures worth Rs.1 lakh were issued at par as part consideration for plant of Rs.4.5
lakhs acquired.
(iii) Part of the investments (Cost – Rs.50,000) was sold for Rs.70,000.
(iv) Pre-acquisition dividend received Rs.5,000 was adjusted against cost of investment.
(v) Interim dividend was declared and paid @ 15% during the current year.
(vi) Income-tax liability for the current year was estimated at Rs.1,35,000.
(vii) Depreciation @ 15% has been charged on Plant and Machinery but no depreciation has
been charged on Building.
The Balance Sheet of New Light Ltd. as at 31st March, 20X1 and 20X0 (for the years
ended) are as follows:
31st March, 31st March,
Notes 20X0 20X1

Equity and Liabilities

1 Shareholders’ funds
A Share capital 1 16,00,000 18,80,000
B Reserves and Surplus 2 8,40,000 11,00,000
2 Non-current liabilities
Long term borrowings 3 4,00,000 2,80,000
3 Current liabilities
A Other current liabilities 4 6,00,000 5,20,000
B Short term provision (provision
for tax) 3,60,000 3,40,000

Total 38,00,000 41,20,000

Assets
1 Non-current assets
A Property, plant and 22,80,000 26,40,000
Equipment 5

B Non-Current Investments 4,00,000 3,20,000

2 Current assets
A Cash and Cash equivalents 10,000 10,000
B Inventory 2,16,000 3,00,000
C Other Current assets 8,94,000 8,50,000
Total 38,00,000 41,20,000

Notes to accounts
No. Particulars 31st March, 31st March,
20X0 20X1
1 Share capital
Equity share capital 12,00,000 16,00,000
10% Preference share capital 4,00,000 2,80,000
Total 16,00,000 18,80,000
2 Reserves and Surplus
General reserve 6,00,000 7,60,000
Profit and Loss account 2,40,000 3,40,000
Total 8,40,000 11,00,000
3 Long term borrowings
9% Debentures 4,00,000 2,80,000
Total 4,00,000 2,80,000
4 Other current liabilities
Dividend payable 1,20,000 -
Current Liabilities 4,80,000 5,20,000
Total 6,00,000 5,20,000
5 Property, plant and
equipment
Property, plant and equipment 32,00,000 38,00,000
Less: Depreciation (9,20,000) (11,60,000)
Net carrying value 22,80,000 26,40,000
Additional information:
(i) The company sold one property, plant and equipment for Rs. 1,00,000, the cost of which was
Rs. 2,00,000 and the depreciation provided on it was Rs.80,000.
(ii) The company also decided to write off another item of property, plant and equipment costing
Rs. 56,000 on which depreciation amounting to Rs. 40,000 has been provided.
(iii) Depreciation on property, plant and equipment provided Rs. 3,60,000.
(iv) Company sold some investment at a profit of Rs. 40,000.
(v) Debentures and preference share capital redeemed at 5% premium. Debentures
were redeemed at the year end.
(vi) Company decided to value inventory at cost, whereas previously the practice was to value
inventory at cost less 10%. The inventory according to books on 31.3.20X0 was Rs. 2,16,000. The
inventory on 31.3.20X1 was correctly valued at Rs. 3,00,000.
Prepare Cash Flow Statement as per revised Accounting Standard 3 by indirect method.