Financial Statements

Cash Flow

Easy

Rathi Udyog, made a profit of 72,000 after changing depreciation of Rs. 17,000 on fixed assets and paid Rs. 10,000 as interim dividend. The goodwill amortized was Rs. 12,000 and profit (Gain) on sale of furniture was Rs. 2,500.

The other informations were :

Trade Payable showed an increase of Rs. 7,000.

Outstanding expenses showed a decrease of Rs. 5,000.

Accrued Income showed an increase of Rs. 8,000.

Trade payable showed a decrease of Rs. 10,000.

Inventories showed a decrease of Rs. 3,000.

On the basis of above infromation answer the following questions.

Apast from showing interim dividend in Net Profit before tax, where else it will be shown ?

Operating Activity

Investing Activity

Financing Activity

Cash and Cash Equivalent

✅ Correct Option: 3

Interim Dividend is first added back to profit (as an appropriation) while computing Net Profit before Tax, and then shown as an actual cash outflow under Financing Activity because it represents a distribution to shareholders.

Question 41

If from the above informations, cash flow from operating activity is ascertained, then it is ascertained according to Accounting standard :

Question 42

In the above case study if amount of Goodwill is increasing in current year, then if will be classified in :

Question 43

Find out Net Profit before tax from the above informations :

Question 44

We add depreciation in order to find out operating profit before working capital changes :

Apast from showing interim dividend in Net Profit before tax, where else it will be shown ?

Solution

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