From the information as contained in the income statement and the balance sheet of Ashok Ltd., you are required to prepare a cash flow statement using (i) Direct Method and (ii) Indirect Method.

A. Income Statement and Reconciliation of Earnings for the year ended 31.3.20 11

     Rs.

Rs.

 Net Sales  

   

25,20,000  

 Less: Cost of sales  

 

19,80,000  

 

 Depreciation  

 

60,000

 

 Salaries and wages  

 

2,40,000  

 

 Operating expenses  

 

80,000

 

 Provision for taxation  

 

88,000

24,48,000  

 Net operating profit  

   

72,000

Non recurring income:

     

Profit on sale of equipment

 

 

12,000

     

84,000

 Retained earnings (balance in profit and loss account brought forward)  

 

 1,51,800  

 

   

 2,35,800  

 Dividend declared and paid during the year  

 

72,000

 Profit and loss account balance as on 31.3.2011  

 

 1,63,800  

B. Comparative Balance Sheets

 

As at 31.3.2010

As at 31.3.2011

 

Rs

Rs

Capital

3,60,000

4,44,000

Surplus in profit and loss A/c

1,51,800

 1,63,800

Sundry creditors

2,40,000

 2,34,000

Outstanding expenses

24,000

 48,000

Income tax payable

12,000

 13,200

Accumulated depreciation on building and equipments

1,20,000

 1,32,000

 

9,07,800

 10,35,000

Fixed assets

 

 

Land

48,000

96,000

Building and equipments

3,60,000

5,76,000

Current assets

 

 

Cash

60,000

72,000

Debtors

1,68,000

1,86,000

Stock

2,64,000

96,000

Advances

7,800

9,000

 

9,07,800

10,35,000

Cost of equipment sold was 72,000.