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Cash Flow Statement—Based on Accounting Standard-3 (Revised) 3.11

II. Cash Flow from Investing Activities
Sale of Land and Building (Note 2) 18,000
Purchase of Land and Building (19,000)
Purchase of Plant and Machinery (12,000)
Cash Used in Investing Activities (13,000)
III. Cash Flow from Financing Activities
Proceeds from Issue of Shares 25,000
Redemption of Debentures (2,500)
Repayment of Bank Overdraft (35,000)
Cash Used in Financing Activities (12,500)
IV. Net Increase in Cash and Bank Balances (I + II + III) 4,050
V. Cash and Bank Balances in the beginning of the Period 250
VI. Cash and Bank Balances at the end of the Period (IV + V) 4,300
Notes:

1. Calculation of Net Profit before Tax: `
Surplus, i.e., Balance in Statement of Profit and Loss (Closing) 33,800
Less: Surplus, i.e., Balance in Statement of Profit and Loss (Opening) 30,250
3,550
Add: Provision for Tax (Current Year) 16,500
Net Profit before Tax 20,050
2. Dr. LAND AND BUILDING ACCOUNT Cr.
Particulars ` Particulars `
To Balance b/d 1,00,000 By Depreciation A/c 6,000
To Bank A/c (Purchase) 19,000 By Bank A/c (Sale) (Balancing Figure) 18,000
By Balance c/d 95,000
1,19,000 1,19,000
3. Interest on debentures is not considered while computing Operating Profit before Working Capital
Changes because rate of interest is not given.
Illustration 8.
The Balance Sheet of Copper & Company Ltd. as at 31st March, 2019 is given below:

BALANCE SHEET as at...

Particulars Note No. 31st March, 31st March,
2019 (`) 2018 (`)
I. EQUITY AND LIABILITIES
1. Shareholders’ Funds
(a) Share Capital 1,80,000 1,50,000
(b) Reserves and Surplus 1 1,00,000 80,000
2. Non-Current Liabilities
Long-term Borrowings 2 1,89,000 1,31,000
3. Current Liabilities
(a) Short-term Borrowings 3 1,000 3,000
(b) Trade Payable 4 14,000 14,000
Total 4,84,000 3,78,000