An extract from a cash flow statement prepared by a trainee accountant is shown below: Which of
Question:
An extract from a cash flow statement prepared by a trainee accountant is shown below:
Which of the following criticisms of this extract are correct ?
1. Depreciation charges should have been added, not deducted.
2. Decrease in inventories should have been deducted, not added.
3. Increase in receivables should have been added, not deducted.
4. Increase in payables should have been added, not deducted.
A. 2 and 4
B. 2 and 3
C. 1 and 4
Transcribed Image Text:
Cash Flow from Operating Activities Net Profit before taxation Adjustment for Depreciation Cash generated from operations before working capital changes Decrease in inventories Increase in receivable Increase in payables . Cash generated from Operations .. 28,00,000 (9,00,000) 19,00,000 3,00,000 (4,00,000) (8,00,000) 10,00,000
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Related Book For
Corporate Accounting As Per The Companies Act 2013 Including Rules 2014 And 2015
ISBN: 9789352605569
2nd Edition
Authors: M Hanif, A Mukherjee
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