Page 155 - AAAXII

Model Test Papers M.147

B. Cash Flow from Investing Activities
Proceeds from Sale of Machinery 2,40,000
Purchase of Machinery (WN) (18,80,000)
Purchase of Non-current Investments (50,000)
Cash Used in Investing Activities (16,90,000)
C. Cash Flow from Financing Activities
Interest on Debentures Paid (1,00,000)
Interim Dividend Paid (` 2,00,000 – ` 60,000) (1,40,000)
Preference Dividend Paid (1,20,000)
Cash Used in Financing Activities (3,60,000)
D. Net Increase in Cash and Cash Equivalents (A + B + C) 7,90,000
Add: Opening Cash and Cash Equivalents 12,10,000
E. Closing Cash and Cash Equivalents 20,00,000
* The company has paid interim dividend on Equity Shares but it did not propose final dividend on them but has paid
dividend on Preference Shares.
Working Note:
Dr. MACHINERY ACCOUNT Cr.
Particulars ` Particulars `

To Balance b/d 20,00,000 By Bank A/c (Sale) 2,40,000
To Gain (Profit) on Sale of Machinery A/c 60,000 (` 4,00,000 – ` 2,20,000 + ` 60,000)
(Statement of Profit and Loss) By Depreciation A/c 7,00,000
To Bank A/c (Purchase) 18,80,000 By Balance c/d 30,00,000
(Balancing Figure)
39,40,000 39,40,000