Page 104 - DCOM302_MANAGEMENT_ACCOUNTING
P. 104

Unit 5: Fund Flow Statement





                Bills payable          40      62   Cash                   30     20            Notes
                Tax provision          80     100   Bank                   20     16
                                     1,354   1,634                       1,354  1,634
               Additional Information:

               (a)   Proposed dividend made during 2006 has been paid during 2007.
               (b)  Depreciation: (i) ` 20,000 on plant and machinery, and (ii)  ` 40,000 on land and
                    buildings.

               (c)   Interim dividend has been paid ` 40,000 in 2007.
               (d)  Income-tax ` 70,000 has been paid during 2007.
          3.   Discuss the various methods of determining the fund from/lost (in) operations.
          4.   Explain the process of preparing the statement of changes in working capital.
          5.    Draft the pro forma of the Fund Flow Statement.
          6.   The summarised balance sheets of KSBS Products for the years ended 31-03-2006 and
               31-03-2007 are given below:
                                                                                (` ‘000)
                 Capital and Liabilities  31.3.2006  31.3.2007  Assets  31.3.2006  31.3.2007
                Share capital          500     500   Land and buildings  180     200
                General reserve        200     220   Plant and machinery  210    276
                Profit & Loss account   40       32   Other fi xed assets  30       45

                Bank loan (long-term)    -     100   Investments         50       50
                Creditors              158     172   Stock              200      190
                Provision for taxation  45      30   Debtors            170      195
                                                     Cash at bank       103       98
                                       943    1,054                     943     1,054
               Prepare a statement of sources and application of funds given the following additional
               information relating to the year ended 31-3-2007.

               (a)   Dividend amounting to ` 30,000 was paid during the year.
               (b)   Provision for taxation made ` 12,000.
               (c)  Machinery worth ` 15,000 (book value) was sold at a loss of ` 3,000.
               (d)  Investment costing ` 10,000 was sold for ` 12,000.

               (e)   Depreciation provided on assets: Land and buildings ` 5,000, Plant and machinery
                    ` 20,00,000.
          7.   Prepare schedule of changes in Working Capital and Funds Flow Statement from the
               following Balance Sheets as on December 31, 2008.
                    Liabilities     2008    2009        Assets        2008      2009
                                    (`)      (`)                       (`)       (`)
                Capital            10,000  10,000  Cash               5,600     5,400
                Profit & Loss A/c   5,200   15,400  Debtors            3,400     6,600

                Long-term Loan     6,000    8,000  Stock              5,400     9,200
                Short-term Loan    2,400    2,400  Long-term          7,000    12,000
                                                   Investments
                                                                                  Contd…



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