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.