As per AS-3, arrange the following items in top to down order of the cash flow statement format according to indirect method.

A. Increase in Current Assets

B. Depreciation of the fixed assets

C. Purchase of Machinery

D. Issue of equity shares by the company

Choose the correct answer from the options given below:

B, A, C, D

Correct answer: Option (3) → B, A, C, D

Concept: Under AS-3 (indirect method), the cash flow statement is arranged as Operating, then Investing, then Financing activities – per Cash Flow Statement.

Operating activities come first: (B) Depreciation on fixed assets is added back to net profit, then (A) Increase in Current Assets is adjusted. Next comes Investing activities: (C) Purchase of Machinery. Finally Financing activities: (D) Issue of equity shares. Hence the top-to-bottom order is B, A, C, D.