Practice Questions on Cash Flow Statement Class 12 Accountancy

1. Give the meaning of cash flow statement. (CBSE 2016)
2. What is the primary objective of preparing cash flow statement?
3. State two objectives of preparing cash flow statement.
4. State any two examples of cash outflow from investing activities.
5. Normally, what should be the maturity period for a short term investment from the date of its acquisition to be qualified as cash equivalents?
6. Dividend received is a financing activity. Is this true? Give reason for your answer.
7. Opening balance of provision for tax is Rs 12000 and closing balance is Rs 9000. Tax paid during the year Rs 7500. Find out the provision for tax made during the year by preparing provision for tax a/c . Also, state how you would record these items while preparing cash flow statement.

8. Calculate cash flow from investing activities from the following information: A company has given you the following information: Machinery as on 1st April 2020- Rs 50,000, Machinery as on 31st March 2021 - Rs 60,000, Depreciation charged during the year Rs 20,000. 

9. A company has given you the following information: Machinery as on April 01, 2016 Rs. 50,000, Machinery as on March 31, 2017 60,000. Accumulated Depreciation on April 01, 2016 Rs 25,000, Accumulated Depreciation on March 31, 2017 Rs 15,000. During the year, a Machine costing Rs. 25,000 with Accumulated Depreciation of Rs. 15,000 was sold for Rs. 13,000. Calculate cash flow from Investing Activities on the basis of the above information.

10. Calculate cash flow from financing activities from the following information of XYZ Ltd.:

a.15,000 equity shares of Rs 10 per share were issued at 5% premium.

b.Preference shares of Rs 1,00,000 were redeemed at a premium of 10%.

  Ques 9.   Following the the balance sheet of Solar Power Ltd as at 31/03/2014:

Particulars	Note No.	31/03/2014	31/03/2013
Equity and Liabilities 1.       Shareholder’s Funds a.       Share capital b.      Reserve and surplus 2.       Non-Current Liabilities a.       Long term borrowings 3.       Current Liabilities a.     Trade payables b.    Short term provisions	1	24,00,000 600,0000   480,000   358,000 100,000	22,00,000 400,000   340,000   408,000 154,000
		39,38,000	35,02,000
Assets 1.       Non Current Assets a.       Fixed Assets i.                    Tangible ii.                  Intangible 2.       Current Assets a.       Current Investment b.      Inventories c.       Trade receivables d.      Cash and cash equivalents	2 3	21,40,000 80,000   480,000 258,000 340,000 640,000	17,00,000 2,24,000   300,000 242,000 286,000 750,000
		39,38,000	35,02,000

 

Notes to Accounts:

Particulars	31/03/2014	31/03/2013
1.       Reserve and  Surplus 2.       Tangible Assets Machinery Less: Accumulated Depreciation 3.       Intangible Assets Goodwill	600,000   25,40,000 (400,000)   80,000	400,000   20,00,000 (300,000)   224,000

 

Additional Information:

During the year, a piece of machinery  costing Rs 48,000 on which accumulated depreciation was Rs 32,000 was sold for Rs 12,000.

Prepare cash flow statement.

(CBSE 2015)

    Ques 10. From the following information of Nova Ltd. , calculate cash flow from investing activities:

Particulars	31.03.2019	31.03.2018
Machinery (Cost) Accumulated Depreciation Goodwill Land	500,000 100,000 150,000 70,000	300,000 80,000 100,000 100,000

 

Additional Information:

During the year, a machine  costing Rs 50,000 on which the accumulated depreciation was Rs 35,000 was sold for Rs 12,000.

( Net cash used in investing activities Rs 258,000)

(CBSE 2020)

Ques 11 The profit of Jova Ltd for the year ended 31^st March 2019 after appropriation was Rs 250,000.

Additional Information:

Particulars	Amount
Depreciation on machinery Goodwill written off Loss on sale of furniture Transfer to  general reserve	20,000 9,000 2,000 22,500

 

The following was the position of its current assets and current liabilities as at 31^st March 2018 and 2019:

Particulars	31/03/2018	31/03/2019
Income received in advance Inventory	8,000 12,000	- 8,000

 

Find out the cash flow from operating activities.

(Ans:Rs 299,500) (CBSE 2020)

Ques: For each of the following transactions, calculate the resulting cash flow and state the nature of cash flow, viz., operating, investing and financing.

1. Acquired machinery for Rs. 2,50,000 paying 20% by cheque and executing a bond for the balance payable.

2. Paid Rs. 2,50,000 to acquire shares in Informa Tech. and received a dividend of Rs. 50,000 after acquisition.

3. Sold machinery of original cost Rs. 2,00,000 with an accumulated depreciation of Rs. 1,60,000 for Rs. 60,000.