Charles Ltd., made a profit of Rs 1,00,000 after charging depreciation of Rs 20,000 on assets and a transfer to general reserve of Rs 30,000. The goodwill amortised was Rs 7,000 and gain on sale of machinery was Rs 3,000. Other information available to you ( changes in the value of current assets and current liabilities) are trade receivables showed an increase of Rs 3,000, trade payables an increase of Rs 6,000, prepaid expenses an increase of Rs 200, and outstanding expenses a decrease of Rs 2,000. Ascertain cash flow from operating activities.

Charles Ltd., made a profit of Rs 1,00,000 after charging depreciation

1.	Charles Ltd., made a profit of Rs 1,00,000 after charging depreciation of Rs 20,000 on assets and a transfer to general reserve of Rs 30,000. The goodwill amortised was Rs 7,000 and gain on sale of machinery was Rs 3,000. Other information available to you ( changes in the value of current assets and current liabilities) are trade receivables showed an increase of Rs 3,000, trade payables an increase of Rs 6,000, prepaid expenses an increase of Rs 200, and outstanding expenses a decrease of Rs 2,000. Ascertain cash flow from operating activities.
Answer» <html><body><p></p>Solution :<img src="https://d10lpgp6xz60nq.cloudfront.<klux>NET</klux>/physics_images/NCERT_ACC_XI_P2_C06_S01_004_S01.png" width="<klux>80</klux>%"/> <br/> Working Notes : <br/>Calculation of Net <a href="https://interviewquestions.tuteehub.com/tag/profit-1168589" style="font-weight:bold;" target="_blank" title="Click to know more about PROFIT">PROFIT</a> before Taxation and Extraordinary items:<br/> (1) Net Profit =<a href="https://interviewquestions.tuteehub.com/tag/rs-625947" style="font-weight:bold;" target="_blank" title="Click to know more about RS">RS</a> 1,00,000<br/> + Transfer to General <a href="https://interviewquestions.tuteehub.com/tag/reserve-1186088" style="font-weight:bold;" target="_blank" title="Click to know more about RESERVE">RESERVE</a> =Rs 30,000<br/>= Rs 1,30,000<br/> <img src="https://d10lpgp6xz60nq.cloudfront.net/physics_images/NCERT_ACC_XI_P2_C06_S01_004_S02.png" width="80%"/> <br/> <img src="https://d10lpgp6xz60nq.cloudfront.net/physics_images/NCERT_ACC_XI_P2_C06_S01_004_S03.png" width="80%"/> <br/>` (##NCERT_ACC_XI_P2_C06_S01_004_S04.png" width="80%"></body></html>

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