FINANCIAL ACCOUNTING

CASH FLOW STATEMENT

Question No.1:

Crescent tools, INC

Income Statement
For the year ended December 2010

Rs.

Sales 95, 000

Less: Cost of goods sold 44,000

Gross Profit on sales 51,000

Less : Operating Expenses 38, 600

(including depreciation of Rs.10,000)

Loss on Sale of fixed asset 1,000

Net Income 12,400

Miracle Tool, INC

Comparative balance Sheet

December 31,
Assets 2010 2009
Rs. Rs.
Cash & Cash equivalents 7, 900 9, 700
Accounts receivables 6, 950 11, 500
Inventory 36, 000 40, 000
Plant & Equipment (net of accumulated depreciation) 65, 950 44, 000
Totals 116,800 105,200

Liabilities & Stockholder's Equity

Accounts payable 16,000 20,800
Debentures - 20,000
Share Capital 80,000 56,000
Retained Earnings 20,800 8,400
Total 116,800 105,200

Requirement:
Prepare Cash Flow Statement.

Question No.2:

Miracle Tool, INC

Comparative balance Sheet

December 31,

Assets 2013 2012

Rs. Rs.

Cash & Cash equivalents 870 300

Accounts receivables 660 600

Inventory 780 700

3,500 2,400
Plant & Equipment
(600) (450)
Accumulated depreciation

Totals 5,210 3,550

Liabilities & Stockholder's Equity

Accounts payable 610 450

Debentures 300 400

Capital Stock (no par value) 2800 2000

1500 700
Retained Earnings

Total 5,210 3,550

Requirement:
Prepare Cash Flow Statement.
Question No.3:

The comparative statements of financial position of sony and Company as at December 31 are
given below:
2012 2011
Non-Current Assets Rs. Rs.
Fixed assets-at cost 825000 650000
Accumulated depreciation (40330) (25480)
Fixed asset- NBV 784670 624520

Long term investment 150000 120000

Current Assets
Inventories 27000 25000
Accounts receivable 37520 77520
Short term investment 15000 10000
Prepayments 2000 4500
Cash and bank 9200 10500

Total Assets 1025390 872040

Capital
Share Capital 701090 618940

Long-term liabilities
Long-term loan payable 100000 85000

Current Liabilities
Accounts payable 150000 125000
Bank overdraft 50000 25000
Interest payable 15000 11500
Accruals 9300 6600

Total Equity and Liabilities 1025390 872040

Profit for the year ended 31st December 2012 was Rs.159, 650:
Prepare Statement of Cash Flows using indirect method.

Question No.4:
The comparative statements of financial position of Asif and Company as at December 31 are
given below:
2012 2011
Non-Current Assets Rs. Rs.
Building 220,000 165,000
Accumulated depreciation (building) (48,000) (35,000)
172,000 130,000
Current Assets
Inventories 65,000 40,000
Accounts receivable 120,000 75,000
Supplies 2,000 1,200
Marketable securities 30,000 38,800
Cash 56,000 25,000

Total Assets 445,000 310,000

Capital
Share Capital 265,000 200,000
Retained earnings 68,000 65,000

Long-term liabilities
Long-term loan payable 50,000 ---

Current Liabilities
Accounts payable 62,000 45,000

Total Equity and Liabilities 445,000 310,000

Required:
Prepare Statement of Cash Flows using indirect method.
Question No.5:
The comparative statements of financial position of Asif and Company as at December 31 are
given below:
2012 2011
Non-Current Assets Rs. Rs.
Fixed assets 50,000 35000
Accumulated depreciation (13870) (7320)
36130 27680
Long term investment 7000 5000

Current Assets
Inventories 4000 3000
Accounts receivable 10200 7600
Short term investment 10000 5000
Prepayments 1600 2000
Cash 3600 1900

Total Assets 72530 52180

Capital
Share Capital 48130 30080

Long-term liabilities
Long-term loan payable 10000 9000

Current Liabilities
Accounts payable 7000 8000
Bank overdraft 3000 1000
Interest payable 400 800
Accruals 4000 3300

Total Equity and Liabilities 72530 52180

Profit for the year ended December 31st, 2012 was Rs. 7250

Required:
Prepare Statement of Cash Flows using indirect method.

Question No.6:
Sun Shine Industries Ltd
Statement of Financial Position
As at June 30,2011
2,011 2,010
Issued Capital 43,009 43,009
Reserves 4,059 3,860
Retained earnings 154,497 110,523
201,565 157,392

Non-Current liabilities 38,436 36,634

Current liabilities
Trade & Other payables 16,794 28,624
Short term borrowings - -
Provision for taxation 4,981 6,217
21,775 34,841
Total Equity & liabilities 261,776 228,867

ASSETS
Property plant & equipment 39,146 34,999
Long Term Investment 3,569 3,231
Long term deposits 2,411 1,902
Current Assets
Stock in trade 38,707 23,611
Investment 13,980 14,527
Loans & advances 32,307 28,834
Trade debts 77,911 82,992
Other receivables 39,904 30,927
Cash & Bank balances 13,841 7,844
216,650 188,735
Total Assets 261,776 228,867

Prepare the Cash flow statement for the year ended on 30 June 2011.
Question No.7:
Diamond Industries Ltd
Statement of Financial Position
As at June 30,2013
(Rs.) (Rs.)
2,013 2,012
Issued Capital 90,000 90,000
Reserves 467,035 484,212
Retained earnings 52,960 57,224
609,995 631,436

Non-Current liabilities 18,171 2,219

Current liabilities
Trade & Other payables 36,551 244,634
Short term borrowings 85,323 -
Provision for taxation 9,722 648
131,596 245,282
Total Equity & liabilities 759,762 878,937

ASSETS
Property, plant & equipment 96,105 102,118
Long Term Investment 193,785 236,876
Long term deposits 334 207
Current Assets
Stock in trade 90,179 169,272
Investment 66,254 63,624
Loans & advances 53,799 24,614
Trade debts 77,377 110,827
Other receivables 162,410 162,410
Cash & Bank balances 19,519 8,989
469,538 539,736
Total Assets 759,762 878,937

Prepare the cash flow statement for the year ended 30 June 2013.
Question No.8:
Use the following data to construct a statement of cash flows using indirect methods.

2,012 2,011
Cash 4,000 14,000
Accounts receivable 25,000 32,500
Prepaid insurance 5,000 7,000
Inventory 37,000 34,000
Fixed assets 316,000 270,000
(45,000 (30,000
Accumulated Depreciation
) )
Total assets 342,000 327,500

Accounts payable Rs.18000 Rs.16,000

Wages payable 4,000 7,000
Note payable 173,000 160,000
Capital stock 106,000 100,000
Retained earnings 59,000 60,500
Total Liabilities & Equity 342,000 327,500

For the year 2011

Sales 200, 000

Cost of goods sold (123,000)
Depreciation expense (15,000)
Insurance expense (11,000)
Wage Expense (50,000)
Profit 1,000
Question No.9:
Use the following data to construct a statement of cash flows using indirect methods.

2012 2011
Cash 30,000 50,000
Accounts Receivable 410,000 460,000
Inventory 300,000 320,000
Prepaid Expenses 20,000 15,000
Investments 50,000 25,000
Land 560,000 300,000
Buildings and
Equipment 2,000,000 1,900,000
Accumulated
Depreciation (800,000) (770,000)

2,570,000 2,300,000

Accounts Payable 300,000 120,000

Accrued Liabilities 40,000 50,000
Bonds Payable 500,000 800,000
Note Payable 150,000 -
Common Stock,
(Rs.2 par value) 200,000 160,000
Paid-in Capital in
Excess of Par Value 710,000 550,000
Retained Earnings 670,000 620,000

Rs. 2,570,000 Rs. 2,300,000

Additional information about 2012 transactions and events:

(a) Net income was Rs.110,000.

(b) Depreciation expense on buildings and equipment was Rs.30,000.