Following is the Balance Sheet of TAV Ltd. as on 31st March, 2024. Prepare a Cash Flow Statement as per AS-3 or Ind AS-7.
| Particulars | Note No. | 2024 | 2023 |
|---|---|---|---|
| I. Equity and Liabilities | |||
| 1. Shareholders' Funds | |||
| (a) Share Capital | 7,50,000 | 6,50,000 | |
| (b) Reserves and Surplus (Profit and Loss Balance) | 2,00,000 | 1,10,000 | |
| 2. Non-Current Liabilities : Long-term borrowings | 2,50,000 | 1,50,000 | |
| 3. Current Liabilities : Trade Payables | 30,000 | 25,000 | |
| Total | 12,30,000 | 9,35,000 | |
| II. Assets | |||
| 1. Non-Current Assets : Fixed Assets : Tangible Assets | 1 | 11,00,000 | 8,00,000 |
| 2. Current Assets : | |||
| (a) Inventories | 60,000 | 50,000 | |
| (b) Trade Receivables | 42,000 | 50,000 | |
| (c) Cash & Cash Equivalents | 28,000 | 35,000 | |
| Total | 12,30,000 | 9,35,000 |
Note No. 1 Tangible Assets
| Particulars | 2024 | 2023 |
|---|---|---|
| Tangible Assets | 11,00,000 | 8,00,000 |
| Purchase during the year | 5,80,000 | |
| Sales at the beginning of the year | 65,000 |
(W.D.V. at the beginning of the year 80,000)
Depreciation of Tangible Asset 2,00,000
OR
Describe the procedure of calculation of Cash Flow from operating activities, investing activities and financial activities. (2 + 2 + 2)
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Start your 14-day free trial to unlock the full solution →Cash from Operating Rs. 3,08,000; used in Investing Rs. 5,15,000; from Financing Rs. 2,00,000; net decrease Rs. 7,000 (opening cash 35,000 -> closing 28,000).
Working notes:
- Net profit before tax = increase in Reserves & Surplus (P&L balance) = 2,00,000 - 1,10,000 = Rs. 90,000 (no tax/dividend given).
- Fixed asset sold: WDV at the beginning Rs. 80,000, sold for Rs. 65,000 -> Loss on sale = Rs. 15,000 (added back in operating; sale proceeds Rs. 65,000 shown in investing). Fixed Assets A/c check: 8,00,000 + 5,80,000 (purchase) - 80,000 (WDV sold) - 2,00,000 (depreciation) = 11,00,000 (closing). Correct.
- Working-capital changes: Inventories up 10,000 (outflow); Trade Receivables down 8,000 (inflow); Trade Payables up 5,000 (inflow).
Cash Flow Statement of TAV Ltd. for the year ended 31st March, 2024 (Indirect Method)
| Particulars | Amount (Rs.) | Amount (Rs.) |
|---|---|---|
| A. Cash Flow from Operating Activities | ||
| Net profit before tax (2,00,000 - 1,10,000) | 90,000 | |
| Add: Depreciation | 2,00,000 | |
| Add: Loss on sale of fixed asset | 15,000 | 2,15,000 |
| Operating profit before working capital changes | 3,05,000 | |
| Less: Increase in Inventories | (10,000) | |
| Add: Decrease in Trade Receivables | 8,000 | |
| Add: Increase in Trade Payables | 5,000 | 3,000 |
| Net Cash from Operating Activities (A) | 3,08,000 | |
| B. Cash Flow from Investing Activities | ||
| Purchase of Fixed Assets | (5,80,000) | |
| Sale of Fixed Assets | 65,000 |
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