Page 217 - DMGT202_COST_AND_MANAGEMENT_ACCOUNTING

Cost and Management Accounting

Notes To Preliminary Expenses off xxxx

To Proposed Dividend xxxx
To Transfer to General Reserve xxxx
To Current Year Provision for Taxation xxxx
To Current Year Provision for Depreciation xxxx
To Balancing Figure
(Fund Lost in Operations) xxxx

12.3.2 Sales Method

Under this method, the following is the statement format is used to arrive fund fl ow from
operations.

Sources:
Sales xxxxx
Stock at the end xxxxx
Less:
Application:
Stock at Opening xxxx
Net Purchases(Purchase-Returns) xxxx
Wages xxxx
Salaries xxxx
Telephone expenses xxxx
Electricity charges xxxx

Office stationery expenses xxxx
Other operating cash expenses xxxx
Fund from Operations xxxx

Example: From the following details calculate funds from operations:
`
Salaries 10,000
Rent 6,000

Refund of Tax 6,000

Profit on Sale of Building 10,000
Depreciation on Plant 10,000
Provision for Taxation 8,000
Loss on Sale of Plant 4,000

Closing Balance of Profit & Loss A/c 1,20,000

Opening Balance on Profit & Loss A/c 50,000
Discount on Issue of Debentures 4,000

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