6 Following Are The: (A) Sales (B) Sundry Debtors (C) Closing Stock (D) Sundry Creditors (E) Fixed Assets
6 Following Are The: (A) Sales (B) Sundry Debtors (C) Closing Stock (D) Sundry Creditors (E) Fixed Assets
9 Balance Sheets of a firm as on 1st January 2008 and 31st December 2008 were as
follows:
Liabilities 1.1.2008 31.12.2008 Assets 1.1.2008 31.12.2008
Rs. Rs. Rs. Rs.
Creditors 40,000 44,000 Cash 10,000 47,000
Loan from X 25,000 - Debtors 30,000 50,000
Loan from Y 40,000 50,000 Stock 35,000 25,000
Capital 1,25,000 1,53,000 Machinery 80,000 55,000
Land 40,000 10,000
Building 35,000 60,000
2,30,000 2,47,000 2,30,000 2,47,000
During the year a machine costing Rs.10,000 (accumulated depreciation Rs. 3,000) was sold for
Rs. 5,000. The balance of provision for depreciation against machinery as on 1st January 2008
was Rs. 25,000 and on 31st December 2008 Rs. 40,000. Net profit for the year 2008 amounted to
Rs.45,000. Prepare Cash Flow Statement.
Ans. Cash Flow from operating activities: Rs. 59,000; Cash Flow from financing
activities: Rs.-32,000; Cash Flow from investing activities: Rs. 10,000
10 X Ltd. supplies you the following, Balance Sheets for the year ending 31.12.2007 and
31.12.08.
Liabilities 31.12.07 31.12.08 Assets 31.12.07 31.12.08
Share Capital 70,000 74,000 Bank Balance 9,000 7,800
10% Bonds 12,000 6,000 Sundry Debtors 14,900 17,700
Sundry Creditors 10,360 11,840 Inventories 49,200 42,700
Provision for Land 20,000 30,000
700 800
doubtful debts Goodwill 10,000 5,000
P/LA/c 10,040 10,560 --
1,03,100 1,03,200 1,03,100 1,03,200
Additional Information:
(a) Dividend paid during 2008, was Rs. 3,500.
(b) Land purchased for Rs. 10,000.
(c) Goodwill written off Rs. 5,000
(d) Bonds Rs. 6,000 redeemed during 2008.
Prepare Cash Flow Statement for the year-ended 31.12.08.
Ans. Cash Flow from operating activities: Rs. 14,300; Cash Flow from investing
activities: Rs. -10,000; Cash Flow from financing activities: Rs. -5,500
11 The following is the summary of financial ratios of a company relating to its liquidity
position
Particulars Year 1 Year 2 Year 3
Current Ratio 2.00 2.13 2.28
Acid Test Ratio 1.20 1.10 .90
Debtors Turnover 10.00 8.00 7.00
Stock Turnover 6.00 5.00 4.00
The current ratio is increasing, while the acid test ratio is decreasing. Explain the contributing
factors for this apparently divergent trend
12 The directors of Precision Tools Ltd. are worried at deteriorating financial position of the
company. The company has utilized full overdraft facility from the bank and is still not able to
pay its creditors on due dates, although profits earned are satisfactory
The following are the balance sheets as on March 31 for the recent 2 years.
14 A person require Rs. 20,000 at the beginning of each year from 2010 to 2014. How
much should he deposit at the end of each year from 2000 to 2005? The interest rate is
10 percent.
Ans. Person should deposit Rs. 7069 at the end of each year from 2000 to 2006.
15 Mr. Sourabh receives a provident fund amount of Rs. 1,00,000. He deposits it in a bank
which pays 10 per cent interest. If he withdraws annually Rs. 20,000 how long can he do
so?
Ans. Mr. Sourabh can withdraw Rs. 20,000 annually for 7 years