Financial Statements

Cash Flow

Hard

Tax paid on capital gains by the company is shown in Cash Flow Statement as :

Cash flow from Operating Activities

Cash outflow from Investing Activities

Cash from Financing Activities

Not Considered in cash flow statement

✅ Correct Option: 2

Tax paid on capital gains arising from sale of fixed assets or investments is shown under Investing Activities as a cash outflow, because the capital gain itself relates to investing activity. This is an exception to the general rule of classifying taxes under Operating Activities.

2022: 20 Aug Shift 2

Cash flow from Operating Activities will be Rs. ________

2026: 24 May Shift 1

If the net profits made during the year are Rs. 1,00,000 and the bills receivables have decreased by Rs. 10,000 and purchase of machinery is Rs.2,00,000 during the year then the cash flow from operating activities will be equal to:

2022: 15 July Shift 2

Identify the Cash Outflow from Financing Activity

2025: 3 June Shift 1

Match List-I with List-II

List–I	List–II
(A) Cash Inflows & Operating Activities	(I) Proceeds from issue of preference or equity shares
(B) Cash Inflows & Financing Activities	(II) Receipt from royalties, fees, commission and other revenues
(C) Cash Inflows & Investing Activities	(III) Payment of Taxes
(D) Cash Outflows & Operating Activities	(IV) Proceeds from disposal of Machinery

Choose the correct answer from the options given below:

2024

Match List-I with List-II

2025: 13 May Shift 2

Which of the following does not result in outflow of cash?

(A) Depreciation

(B) Loss on sale of fixed assets

(D) Goodwill written off

Choose the correct answer from the options given below:

Tax paid on capital gains by the company is shown in Cash Flow Statement as :

Solution

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