Answer the following questions:

(A)

Prepare a Cash Flow Statement using proper format as per the Direct Method: i. Purchased Rs. 50,00,000/- subsidized weaving machine from Scotland ii. Paid Interim Dividend Rs. 15,000/- to Preference Shareholders iii. Redeemed Debentures with Interest for Rs. 11,00,000/- iv. Paid Quarterly Income Tax in Advance for Rs. 3,50,000/- v. Paid Diwali Bonus to Workers Rs. 65,000 vi. Cash Sales made Rs. 20,00,000/-

(B)

For ABC Ltd., the current ratio as of 1st April 2021 is 2.5:1. Current assets are Rs. 1,00,000 and current liabilities are Rs. 40,000. How much must the company decline its current assets to bring to the ideal current ratio? Show the Working.