Page 249 - DMGT202_COST_AND_MANAGEMENT_ACCOUNTING

Cost and Management Accounting

Notes 2. Draw the proforma of the Adjusted profit and loss account.

3. Data Ltd., supplies you the following balance on 31st Mar 2005 and 2006.
Liabilities 2005 2006 Assets 2005 2006
Share capital 1,40,000 1,48,000 Bank balance 18,000 15,600
Bonds 24,000 12,000 Accounts Receivable 29,800 35,400
Accounts payable 20,720 23,680 Inventories 98,400 85,400
Provision for debts 1,400 1,600 Land 40,000 60,000
Reserves and Surpluses 20,080 21,120 Good will 20,000 10,000
2,06,200 2,06,400 2,06,200 2,06,400

Additional Information:
(a) Dividends amounting to ` 7,000 were paid during the year 2006.
(b) Land was purchased for ` 20,000.
(c) ` 10,000 were written off on good will during the year.

(d) Bonds of ` 12,000 were paid during the course of the year.
You are required to prepare a cash fl ow statement.
4. Since everything has some utility, analyse the cash flow statement analysis and explain its

various utilities.
5. Discuss the procedure of determining cash provided by operating activities. Give suitable
example to illustrate your answer.
6. The following is the abstract of balance sheet of Software securities ltd for the year 2005 and
2006.
Liabilities 2005 2006 Assets 2005 2006
(`) (`) (`) (`)
Provision for 108000 396000 Land 26000 81000
depreciation
Retained earning 244800 370800 Building 60000 360000
9% Debenture 270000 198000 Accumulated 19800 37800
depreciation on building
Account payable 72000 41400 Equipment 122400 347400
Expense payable 0 18000 Accumulated 18000 50400
depreciation on
Equipment
Stock in hand 10800 97200
Account receivable 36000 122400
Cash in hand 66600 97200
Preliminary expenses 10800 720

The income statement of Software Securities Ltd. is as under

Sales 1602000
less cost of sale 837000
less operating exp. 397800
less interest exp. 21600
Contd...

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