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IN FINANCIAL POSITION
STATEMENT OF CHANGE IN
FINANCIAL POSITION
The term
Procedure of preparation
Statement or Schedule of
Change in Working Capital
Previous
Year
Current Assets:
Cash in hand
Cash at bank
Bills receivables
Sundry debtors
Marketable securities
Stock/Inventories
Prepaid Expenses
Accrued Incomes
(A) Total Current Assets
Current Liabilities:
Bills Payable
Sundry Creditors
Outstanding Expenses
Bank Overdraft
Dividend payable
Proposed Dividends*
Current Year
Decrease
100000
120000
120000Land
31.12.2008 31.12.2009
44000
68000
180000
180000
10000
6250
P&L A/c
25000
75000Machinery
Long term
55000 Investments
Mortgaged Loan
50000
40000Goodwill
13000
13000
Debentures
20000
25000Stock
30000
28000
Bills Payable
1500
19000
20000
3220
29000
9000
70
300
3000
2000
328070
326550
Accrued Expenses
Trade creditors
350
8000
328070
900Trade debtors
5170Cash
160Prepaid Expenses
5320Bilss receivable
326550
Report Form
Funds from
Operations
Issue of Share capital
Issues of Debentures
Raising of long-term
loans
Receipts from partly
paid up shares, called
up
Sale of fixed assets
Non-trading receipts
such as dividends
Sale of long-term
Investments
Net decrease in
Working Capital
Amount
(Rs.)
Applications
Funds lost in
Operations
Redemption of
Preference share
capital redemption of
Debentures
Repayment of long
term loans
Purchase of fixed
assets
Purchase of long-term
Investments
Non-trading payments
Payment of Dividends*
Payment of tax*
Net decrease in
Working Capital
Amount
(Rs.)
Goodwill
Patents
Trade Marks
Preliminary Expenses
Dividends including:
Interim Dividend
Amount (Rs.)
2010
30000
40000
General Reserve
20000
25000
Goodwill
10000
5000
Preliminary Expenses
6000
4000
10000
12000
Funds from
Operations
Issue of Share capital
Issues of Debentures
Raising of long-term
loans
Receipts from partly
paid up shares, called
up
Sale of fixed assets
Non-trading receipts
such as dividends
Sale of long-term
Investments
Net decrease in
Working Capital
Amount
(Rs.)
Applications
Funds lost in
Operations
Redemption of
Preference share
capital redemption of
Debentures
Repayment of long
term loans
Purchase of fixed
assets
Purchase of long-term
Investments
Non-trading payments
Payment of Dividends*
Payment of tax*
Net decrease in
Working Capital
Amount
(Rs.)
The following are the balance sheets of PQR Ltd. For the year 2009
and 2010. Prepare the Funds flow statement for the year 2010.
Balance Sheets (Rs. In Lacs)
31.12.2010 Assets
31.12.2009
31.12.2010
Share capital
300
460
Fixed
assets
630
690
General
reserve
150
180
Long term
investments
130
180
P &L a/c
30
65
Debtors
135
220
Term loan
210
150
Stock
180
220
Creditors
80
100
Bank
15
Bank overdraft
250
300
Short term
investments
25
30
Other liabilities
85
100
1105
1355
1105
1355
Additional capital of 160 lacs was brought during the year and is eligible for dividend
for full year. For 2010, the proposed dividend is Rs. 85 lacs is included in other
liabilities. Depreciation on fixed assets has been provided to the extent of Rs. 90 lacs.
C.F.S. Benefits
Ability to generate Cash & CE
Needs to utilise cash flows
Assess Liquidity & Solvency
Indicator of future cash flow
Relationship: Profitability & Net Cash
Flow
Customers
Cash paid to Suppliers & Employees
Cash generated from Operation
- Income taxes paid
Cash flow before Extra-ordinary items
- Extra-ordinary items
Net cash from Operating Activities
Depreciation
Foreign Exchange Loss
Interest & Dividend Income
Interest Expense
Extra-ordinary Items
Amount
(Rs.)
Dr.
(Rs.)
50000
30000
5000
20000
20000
30000
40000
10000
5000
40000
250000
Particulars
Gross profit
Profit on sale of
machinery
Dividend received
Cr. (Rs.)
225000
5000
20000
250000
Dividend Paid
Opening balance of P &L a/c
Add: Net profit
Less: Closing balance of P &L a/c
Dividend paid
From the following summarized Balance Sheets of ABC Ltd. For 2009 and 2010 and
the Income statement of 2010. you are required to prepare the Cash Flow statement.
Liabilities
Amount Amount
Assets
Amount Amount
(Rs. )
(Rs. )
(Rs. )
(Rs. )
Equity Share
Capital
14000
24000
P &L a/c
7000
9600
Debenture
20000
20000
Trade
creditors
14000
12000
55000
Fixed assets
Less: Dep
20000
4000
24000
8000
16000
16000
Cash
16000
20000
Stock
14000
16000
Trade debtors
7000
12000
Discount on
debentures
2000
1600
55000
65600
65600
Income Statement-2010
Revenue:
Less: Cost of goods sold Rs. 48000
Depreciation
4000
Interest
6000
Other Expenses
22000
Net Profit
Rs.84000
80000
4000
From the following Balance Sheet of Samrat Construction Ltd. as on March 31,
2009 and March 31, 2010, Prepare a cash flow statement
Liabilities
Amount
(Rs. )
Amount
(Rs. )
Assets
Amount
(Rs. )
Amount
(Rs. )
Equity Share
Capital
200000
200000
Land and
Building
Machinery
140000
170000
214000
354000
54000
244000
414000
72000
300000
342000
Stock
50000
44000
Trade debtors
70000
76800
Cash
8000
7200
428000
470000
Less: Dep
Reserves
96000
98000
Debenture
60000
90000
Trade
creditors
72000
82000
428000
470000