Question : If a machine whose original cost is Rs.40,000 having accumulated depreciation Rs.12,000, were sold for Rs.34,000 then while preparing Cash Flow Statement its effect on cash flow will be :
Option 1: Cash flow from financing activities Rs.34,000
Option 2: Cash flow from financing activities Rs.6,000
Option 3: Cash flow from investing activities Rs.34,000
Option 4: Cash flow from investing activities Rs.6,000
Correct Answer: Cash flow from investing activities Rs.34,000
Solution : Rs.34000 will be shown as cash flow from investing activities because it generates cash flow in the business from the sale of assets.
Hence the correct answer is option 3.
Question : Sold machinery of original cost Rs. 2,00,000 with an accumulated depreciation of Rs. 1,60,000 for Rs. 60,000. Cash flow from investing activities is
Question : If 6% Pref. share capital of Rs. 2,00,000 were redeemed at a premium of 5%, while preparing Cash Flow Statement its effect on cash flow will be :
Question : The cash flow statement begins with :
Question : Under which type of activity will you classify 'Proceeds from Sale of Patents' while preparing Cash Flow Statement?
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