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4.34 Analysis of Financial Statements—CBSE XII
Notes to Accounts
Particulars 31st March, 31st March,
2024 (`) 2023 (`)
1. Trade Payables
Creditors 55,000 50,000
Bills Payable 20,000 50,000
75,000 1,00,000
2. Property, Plant and Equipment
Building 2,50,000 4,00,000
Plant and Machinery 2,70,000 3,00,000
5,20,000 7,00,000
3. Current Investments
Investment in Securities (Other than Marketable Securities) 90,000 ...

Additional Information:
1. ` 50,000 as Interim Dividend was paid during the year.
2. Building is sold at book value.
Solution: CASH FLOW STATEMENT for the year ended 31st March, 2024

Particulars `
(A) Cash Flow from Operating Activities
Net Profit before Tax and Extraordinary Items (WN) 2,65,000
Add: Non-Cash Items and Non-operating Items:
Goodwill amortised (` 1,00,000 – ` 50,000) 50,000
Depreciation on Plant and Machinery (` 3,00,000 – ` 2,70,000) 30,000
Interest on Debentures 6,000
Operating Profit before Working Capital Changes 3,51,000
Add: Decrease in Current Assets and Increase in Current Liabilities:
Creditors (Trade Payables) 5,000
Inventories 10,000
3,66,000
Less: Increase in Current Assets and Decrease in Current Liabilities:
Trade Receivables 40,000
Bills Payable (Trade Payables) 30,000 70,000
Cash Generated from Operating Activities 2,96,000
Less: Tax Paid 50,000
Cash Flow from Operating Activities 2,46,000
(B) Cash Flow from Investing Activities
Proceeds from Sale of Building 1,50,000
Purchase of Non-Current Investments (2,70,000)
Purchase of Securities (90,000)
Cash Used in Investing Activities (2,10,000)
(C) Cash Flow from Financing Activities
Proceeds from Issue of Shares 3,00,000
Payment of Interest on Debentures (6,000)
Payment of Interim Dividend (50,000)
Proceeds from raising of Bank Loan 50,000
Cash Flow from Financing Activities 2,94,000
(D) Net Increase In Cash and Cash Equivalents (A + B + C) 3,30,000
Add: Cash and Cash Equivalents in the beginning of the year 50,000
(E) Cash and Cash Equivalents at the end of the year 3,80,000