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    1st Class Cash Flow Statement

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    prakash
    step by step learning cash flow statement

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    1st Class Cash Flow Statement

    Uploaded by

    prakash
    11 views12 pages
    step by step learning cash flow statement

    Original Title

    1st class Cash flow statement

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    step by step learning cash flow statement

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    11 views12 pages

    1st Class Cash Flow Statement

    Uploaded by

    prakash
    step by step learning cash flow statement

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 12

    Cash Flow Statement

    IMPORTANT POINTS
    1. Cash inflow xxx cash receipts
    Cash outflow (xxx) cash payment
    2. Rules
    a. Assets increased (xxx)
    Assets decreased xxx
    b. Capital/Liabilities increased xxx
    Capital/Liabilities decreased (xxx)
    Three Business Activities

    Business Activities

    Operating Investing Financing


    activities activities activities
    a. Operating activities:
    • Cash collection from sales and debtors xxx
    • Cash payment to purchase and creditors (xxx)
    • Payment to employees and other operating expenses (xxx)
    • Payment of interest (xxx)
    • Payment of tax (xxx)
    • Cash flow from current assets except cash and bankxxx or
    (xxx)
    • Cash flow from current liabilities xxx or (xxx)
    b. Investing activities: Long term assets related
    (i.e. fixed assets and long term investment)
    Purchase of fixed assets and investment (xxx)
    Sales of fixed assets and investment xxx
    c. Financing activities:
    Long term liabilities and capital related
    Issue of shares and debentures xxx
    Redemption of shares and debentures (xxx) Dividend paid
    (xxx)
    Premium on redemption of debentures (xxx)
    Borrowing of long term loan/bank loan xxx
    Repayment of long term loan/bank loan (xxx)
    Practice

    Page no. 370


    Q.N. 1 [HSEB QUESTION 2066]
    Cash Flow Statement
    Direct Method
    PARTICULARS AMOUNT AMOUNT (Rs.)
    (Rs.)
    Operating Activities:
    a. Cash collection from sales and debtors/A/R/B/R:
    Net sales 625,000 625,000
    b. Cash payment to purchase and creditors/A/P/B/P:
    Cost of goods sold (300,000)
    Stock (inventory) increase (50,000)
    Account payable increase 10,000 (340,000)
    c. Payment to employees and other operating expenses:
    Operating expenses (Rs. 150,000-Rs. 80,000-Rs. 10,000) (60,000) (60,000)
    Prepaid/outstanding/payable -
    d. Payment of interest (10,000)
    Interest on debenture
    e. Payment of tax -
    1. Net cash flow from operating activities (a+b+c+d+e) 215,000
    Investing Activities:
    Purchase of fixed assets (380,000)
    Sales of fixed assets (Book value +gain) 55,000 (325,000)
    2. Net cash flow from investing activities (325,000)
    Financing Activities:
    Issue of shares 270,000
    Redemption of debenture (60,000)
    Dividend paid (105,000) 105,000
    3. Net cash flow from financing activities 105,000
    Net cash decrease (1+2+3) (5,000)
    Add: Opening balance of cash and bank 100,000
    Closing balance of cash and bank 95,000

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