Financial Statements

Cash Flow

Easy

Cash flow statement is part of financial statements as per The Companies Act 2013 and prepared in accordance with Accounting Standard_____.

AS-5

AS-3

AS-1

AS-7

✅ Correct Option: 2

Cash Flow Statement is prepared as per AS-3 (Cash Flow Statements).

AS-3 specifically deals with the preparation and presentation of Cash Flow Statement, which is a mandatory part of financial statements under The Companies Act 2013 for prescribed class of companies.

The other Accounting Standards mentioned serve different purposes:

AS-1 deals with Disclosure of Accounting Policies
AS-5 covers Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies
AS-7 relates to Construction Contracts

AS-3 requires classification of cash flows into three activities: Operating Activities, Investing Activities, and Financing Activities, helping users understand the cash generation and utilization pattern of the enterprise.

2026: 11 May Shift 2

Match the LIST-I with LIST-II

LIST-I		LIST-II
A. Demand deposits with banks is	I.	Cash flow from operating activities
B. Cash receipts from royalties, fees, commissions and other revenues	II.	Cash flow from investing activities
C. Interest received in cash from loans and advances	III.	Cash flow from financing activities
D. Cash proceeds from issuing shares	IV.	Cash and cash equivalents

Choose the correct answer from the options given below:

2025: 2 June Shift 2

Cash received from the issue of debenture for a trading organization is.

2023: 28 May Shift 1

Pick the odd one out while Calculating Cash Flow from Financing Activities :

2026: 6 June Shift 1

Match List-I with List-II

List-I	List-II
(A) Acquisition of Machinery by Issue of Equity Shares	(I) Investing Activities
(B) Purchase of Machinery for cash	(II) Non-cash Item
(C) Amortisation of Goodwill	(III) Financing Activities
(D) Repayment of Bank Loan	(IV) Operating Activities

Choose the correct answer from the options given below:

2022: 16 July Shift 2

If the net profit earned during the year is Rs.50,000 and amount of Depreciation during the year is Rs.15,000, then the cash flow from operating activities will be equal to Rs. _______.

2022: 20 July Shift 1

Arrange the following items to be in order while making Cash Flow Statement as per AS.3

(a) Income Tax paid

(b) Purchase of Furniture

(d) Debentures issued

(e) Shares purchased

Choose the correct answer from the options given below :

Cash flow statement is part of financial statements as per The Companies Act 2013 and prepared in accordance with Accounting Standard_____.

Solution

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