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3.10 Management Accounting (Section B)—ISC XII

II. ASSETS
1. Non-Current Assets
Fixed Assets: Tangible Assets 4 1,82,000 1,75,000
2. Current Assets
(a) Inventories 37,000 50,000
(b) Trade Receivables 32,100 40,000
(c) Cash and Bank Balances 4,300 250
Total 2,55,400 2,65,250

Notes to Accounts
Particulars 31st March, 31st March,
2019 (`) 2018 (`)
1. Reserves and Surplus
Surplus, i.e., Balance in Statement of Profit and Loss 33,800 30,250
2. Short-term Borrowings
Bank Overdraft ... 35,000
3. Short-term Provisions
Provision for Tax 16,500 15,000
4. Fixed Assets (Tangible)
Land and Building 95,000 1,00,000
Plant and Machinery 87,000 75,000
1,82,000 1,75,000
Additional Information:
1. Depreciation written off on Building during the year ended 31st March, 2019 was ` 6,000.
2. Land was purchased for ` 19,000 during the year ended 31st March, 2019.
Prepare Cash Flow Statement of Rajneesh Ltd. (ISC 2006, Modified)

Solution: Rajneesh Ltd.
CASH FLOW STATEMENT for the year ended 31st March, 2019
Particulars ` `
I. Cash Flow from Operating Activities
Net Profit before Tax (Note 1) 20,050
Add: Non-cash Expenses:
Depreciation on Land and Building 6,000
Operating Profit before Working Capital Changes 26,050
Add: Decrease in Current Assets:
Inventories 13,000
Trade Receivables 7,900 20,900
46,950
Less: Decrease in Current Liabilities:
Trade Payables 2,400 2,400
Cash Flow from Operating Activities before Tax 44,550
Less: Income Tax Paid 15,000
Cash Flow from Operating Activities 29,550