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Cash Flow Statement 4.5

CASH FLOW FROM OPERATING ACTIVITIES
Particulars ` `
Net Profit after Tax 80,000
Add: Provision for Tax 60,000
Cash Generated from Operations 1,40,000
Less: Tax Paid 40,000
Cash Flow from Operating Activities 1,00,000

Illustration 2. Calculate Net Profit before Tax and Extraordinary Items from the following
Balance Sheet of Prime Hotels Ltd. as at 31st March, 2024:

Particulars Note No. 31st March, 31st March,
2024 (`) 2023 (`)
I. EQUITY AND LIABILITIES
1. Shareholders’ Funds
(a) Share Capital 8,00,000 6,00,000
(b) Reserves and Surplus 1 3,30,000 2,20,000
2. Current Liabilities
(a) Short-term Borrowings 2 40,000 55,000
(b) Trade Payables 50,000 80,000
(c) Other Current Liabilities 25,000 10,000
(d) Short-term Provisions 3 70,000 40,000
Total 13,15,000 10,05,000
II. ASSETS
1. Non-Current Assets
(a) Property, Plant and Equipment and Intangible Assets:
—Property, Plant and Equipment 9,75,000 6,05,000
(b) Non-current Investments 1,10,000 1,00,000
2. Current Assets 2,30,000 3,00,000
Total 13,15,000 10,05,000

Notes to Accounts
Particulars 31st March, 31st March,
2024 (`) 2023 (`)
1. Reserves and Surplus
General Reserve 1,20,000 80,000
Surplus, i.e., Balance in Statement of Profit & Loss 2,10,000 1,40,000
3,30,000 2,20,000
2. Short-term Borrowings
Bank Overdraft 40,000 55,000
3. Short-term Provisions
Provision for Tax 70,000 40,000

Note: Proposed dividend for the years ended 31st March, 2023 and 2024 are ` 90,000 and ` 1,00,000 respectively.