Transcribed Image Text:Q3.
The following is the summarized balance sheet of Michael Ltd.
LIABILITIES
2018
2019
Equity Share Capital
200000
240000
Debentures
50000
Securities Premium
10000
General Reserve
30000
50000
Profit & Loss A/C
48000
68000
Sundry Creditors
Proposed Dividend
Provision for Depreciation
Plant & Machinery
130000
150000
20000
24000
140000
150000
Furniture
6000
4000
624000
696000
ASSETS
Land & Building
Plant & Machinery (Cost)
Furniture (Cost)
105000
150000
290000
320000
9000
10000
Inventories
130000
105000
Sundry Debtors
Cash
75000
85000
15000
26000
624000
696000
ADDITIONAL INFORMATION:
1. Furniture which cost Rs. 5,000, written down value Rs. 1,000 was sold during the year 2019
for Rs. 2,000.
2. Plant and Machinery which cost Rs. 20,000 and in respect of which Rs. 13,000 had been
written off as depreciation was sold during the year for Rs. 3,000.
3. The dividend of 2018 was paid during 2019.
You are required to prepare Cash Flow Statement.
Definition Definition Net amount of cash that an entity receives and expends over the course of a given period. For a business to continue operating, positive cash flows are required, and they are also necessary to produce value for investors. Investors in particular prefer to see growing cash flows even after capital expenditures have been paid for (which is known as free cash flow).
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