Illustration‐1
The following are Balance Sheet and Income Statement of Om ltd.
Liabilities 1.1.06 31.12.06 Assets 1.1.06 31.12.06
Share capital 1,80,000 2,22,000 Fixed Assets:
Profit & lossA/c 75,900 81,900 Land 24,000 48,000
Creditors 1,20,000 1,17,000 Building 1,80,000 2,88,000
Outstanding Expenses 12,000 24,000 Current Assets:
Provision for tax 6,000 6,600 Cash 30,000 36,000
Prov. For Dep. On building 60,000 66,000 Debtors 84,000 93,000
Stock 1,32,000 48,000
Advances 3,900 4,500
4,53,900 5,17,500 4,53,900 5,17,500
Information: Company sold building during the year, cost price of which wasRs.36,000.
Profit And Loss A/C
For year ended 31.3.06
Particular RS Particular RS
To Cost of sales 9,90,000 By Net sales 12,60,000
To Wages & salaries 1,20,000
To Gross profit c/d 1,50,000
12,60,000 12,60,000
By Gross profit
To Operating Exp. 40,000 1,50,000
By Profit on sale of Building
To Depreciation 30,000 6,000
To Provision for tax 44,000
To Net profit 42,000
1,56,000 By Balance b/d 1,56,000
By Net Profit (transf.)
To proposed Dividend 36,000 75,900
To balance Carried to 81,900 42,000
Balance sheet
1,17,900 1,17,900
You are required to prepare a cash flow statement.
Illustration:2
Following are the balance sheets of Vijay & son:
Liabilities 1‐1‐05 31‐12‐ Assets 1‐1‐05 31‐12‐05
05
Creditors 36,000 41,000 Cash 4,000 3,600
Loan from Partner ‐ 20,000 Debtor 35,000 38,400
Loan from Bank 30,000 25,000 Stock 25,000 22,000
Capital 1,48,000 1,49,000 Land 20,000 30,000
Building 50,000 55,000
Machinery 80,000 86,000
2,14,000 2,35,000 2,14,000 2,35,000
During the yearRs.26,000 paid as dividend. The provision made for depreciation against machinery
as on 1.1.05 was Rs. 27,000 and on 31.12.05 Rs 36,000.
Prepare a cash flow statement.
Illustration:3
The summarized balance sheet of Bhadresh Ltd. as on31.12.05 and 31.12.2006 are as follows:
Liabilities 2005 2006 Assets 2005 2006
Share capital 4,50,000 4,50,000 Fixed asset 4,00,000 3,20,000
General Reserve 3,00,000 3,10,000 Investment 50,000 60,000
P & l a/c 56,000 68,000 Stock 2,40,000 2,10,000
Creditors 1,68,000 1,34,000 Debtor 2,10,000 4,55,000
Tax provision 75,000 10,000 Bank 1,49,000 1,97,000
Mortgage loan ‐ 2,70,000
10,49,000 12,42,000 10,49,000 12,42,000
Additional Details:
1. Investment costing Rs.8,000 were sold for Rs.8,500
2. Tax provision made during the year was Rs.9,000
3. During the year part of fixed assets costing Rs10,000 was sold forRs12,000 and the profit was
included in P & L A/c. You are required to prepare cash flow statement for 2006.
Illustration:4
Prepare cash flow statement of Satyam ltd. From the following:
Liabilities 1.1.06 31.12.06 Assets 1.1.06 31.12.06
Share capital 1,00,000 4,00,000 Goodwill ‐ 20,000
8% debenture ‐ 2,00,000 Machinery 1,25,000 4,75,000
Retained earning 60,000 90,000 Stock 20,000 80,000
Creditors 40,000 1,00,000 Debtor 30,000 1,00,000
Bills payable 20,000 40,000 Bank 50,000 1,50,000
Tax provision 30,000 40,000 Cash 25,000 45,000
2,50000 8,70,000 2,50,000 8,70,000
Additional Details:
1. During 2006 the business of a sole trader was purchased by issuing share for Rs. 2,00,000. The
assets acquired from him were:
Goodwill Rs.20,000, machinery Rs.1,00,000,stock Rs.50,000 and Debtors Rs. 30,000
2. Provision for tax charged in2006 was Rs. 35,000
3. The debenture was issued at a premium of 5% which is included in the retained earnings.
4. DepreciationchargedonmachinerywasRs.30,000.
Illustration:5
The summarized balance sheet of Jay Ltd as on 31.12.06 and 31.12.2007are as follows:
Liabilities 2006 2007 Assets 2006 2007
Share capital 1,00,000 1,00,000 Building 46,800 45,000
General Reserve 38,400 42,000 Plant and Machinery 38,280 42,030
Creditors 9,750 6,380 Goodwill 13,000 13,000
Tax provision 19,000 21,000 Investment 10,000 11,250
Prov. for doubtful debt 1,000 1,200 Stock 30,000 28,000
Debtor 22,070 22,300
Cash 8,000 9,000
1,68,150 1,70,580 1,68,150 1,70,580
After taking the following information in to account, prepare a cash flow statement for the year
ending 31.12.2007
1. The profit for 2006‐2007 was Rs.8,600 against this had been charged Dep. Rs. 3,050 and increase
in provision for doubtful debt Rs.200
2. Income tax Rs.18,000 was paid during the year charged against the provision and in addition
Rs.20,000 was charged against profit and carried to the provision.
3. AninterimdividendOfRs.5,000waspaidinJanuary2007
4. AdditionalplanwaspurchasedinSeptember2006for Rs.5,000
5. Investments (cost Rs.5,000)were sold 2007 forRs.4800 and on 1 stmarch 2007 another investment was made
for Rs. 6,250.
Illustration‐ 6
TheBalanceSheetsofafirmason31stDecember2008and 2009aregivenbelow:
Liabilities 2008 2009 Assets 2008 2009
ShareCapital 1,00,000 1,60,000 FixedAssets‐Cost 1,52,000 2,00,000
Retained Earnings 70,250 85,300 Inventory 93,400 89,200
Accumulated 60,000 40,000 Debtors 30,800 21,100
Depreciation
12%Debenture 50,000 ‐ Prepaid expenses 3,950 3,000
Creditors 28,000 48,000 Bank 28,100 20,000
3,08,250 3,33,300 3,08,250 3,33,300
Additional Information:
1. Net profit is Rs. 27,050.
2. Depreciation charged Rs. 10,000.
3. Cash dividend declared during the period Rs.12,000.
4. AnadditiontothebuildingwasmadeduringtheyearatacostofRs.78,000 and fully depreciated
equipment costing Rs. 30,000 was discarded as no salvage being realized.
Prepare a Cash Flow Statement.
Illustration‐ 7
From the following information, prepare cash flow statement:
Balance‐Sheet
Liabilities 1‐1‐2012 31‐12‐2012 Assets 1‐1‐2012 31‐12‐2012
Share Capital 2,00,000 2,00,000 Cash 8,000 10,000
Profit & Loss 50,000 90,000 Bank 22,000 20,000
Bank Loan 10,000 ‐ Debtors 10,000 20,000
Outstanding 5,000 1,000 Stock 25,000 15,000
Expenses
Creditors 15,000 20,000 Non‐ 2,35,000 2,75,000
current
asset
Provision for tax 20,000 25,000
Unclaimed Dividend ‐ 4,000
3,00,000 3,40,000 3,00,000 3,40,000
Net profit for the year 2012 after providing Rs.20,000 as depreciation was Rs. 60,000. During
2012, company declared equity dividend @ 10% and paid Rs. 15,000 as Income ‐ tax.
Illustration‐ 8
From the following Balance‐Sheet prepare cash flow statement for the year2012.
Liabilities 1‐1‐2012 31‐12‐2012 Assets 1‐1‐2012 31‐12‐
2012
Share Capital 1,25,000 1,53,000 Cash 10,000 7,000
Creditors 40,000 44,000 Debtors 30,000 50,000
Loan from X 25,000 ‐ Stock 40,000 25,000
Loan from bank 40,000 50,000 Machinery 80,000 55,000
Land 35,000 50,000
Building 35,000 60,000
2,30,000 2,47,000 2,30,000 2,47,000
During the year a machine costing Rs. 10,000 with accumulated depreciation Rs. 3,000 was sold for
Rs. 5,000.
Illustration‐ 9
ThefollowingarethesummarizedfinancialstatementsofAmbujaCo.Ltd.for 2012 and 2013:
Statement of Financial Position
Particulars 2013 2012
Assets:
Cash 9,000 15,000
Debtors 25,000 31,000
Stock 60,000 45,000
Fixed asset at cost 1,20,000 1,05,000
2,14,000 1,96,000
Liabilities:
Share Capital 32,500 31,500
6%Debenturesdueon31‐12‐2015 50,000 70,000
Retained Earnings 38,500 27,500
Creditors 20,000 12,500
Income‐tax Payable 36,000 27,500
Accumulated Depreciation 37,000 27,000
2,14,000 1,96,000
Income Statement
st
(ForTheYearEnding31 December)
Particulars Amou Amount
nt
Sales 4,25,0 4,50,000
00
Operating Expenses(including depreciation Rs. 10,000) 3,40,0 3,80,800
00
Interest on Debentures 3,000 4,200
Net Profit Before Tax 82,00 65,000
0
Income Statement 36,00 27,500
0
46,00 37,500
0
Statement of Retained Earnings
Particulars Amount Amount
Retained Earnings–Beginning 27,500 25,000
Net Profit for the year 46,000 37,500
73,500 62,500
Dividends 35,000 35,000
Retained Earnings–End 38,500 27,500
