Target Exam

CUET

Subject

-- Accountancy Part B

Chapter

Cash Flow Statement

Question:

From the following information of I Ltd., calculate Net Increase/Decrease in cash and cash equivalents during the year 2021-22.

i) Cash flow from Operating Activities: ₹2,35,000
ii) Cash used in investing Activities: ₹4,35,000
iii) Cash flow from financing activities: ₹2,35,000

Options:

₹35,000 Decrease

₹4,35,000 Decrease

₹4,70,000 increase

₹35,000 Increase

Correct Answer:

₹35,000 Increase

Explanation:

The correct answer is option 4- ₹35,000 Increase.

Cash flow from Operating Activities:           ₹ 2,35,000
Less : Cash used in investing Activities:     ₹ 4,35,000
Add: Cash flow from financing activities:    ₹ 2,35,000
Net Increase/Decrease in cash and cash equivalents = (2,35,000 - 4,35,000 + 2,35,000)
                                                                                    = 35,000 increase