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Home Questions BZC4WQDZK5
Target Exam

CUET

Subject

Accountancy

Chapter

Cash Flow Statement

Question:

Read the following information and answer the question.

PARTICULARS AMOUNT AT THE BEGINNING
OF THE YEAR (₹)		 AMOUNT AT THE END
OF THE YEAR (₹)
Plant (cost) 3,00,000 3,20,000
Accumulated depreciation 90,000 1,00,000
Patents 2,60,000 1,40,000
Goodwill 80,000 1,00,000

ADDITIONAL INFORMATION:

  1. The depreciation charged during the year on the plant was ₹36,000.
  2. A plant having a book value of ₹20,000 was sold for ₹16,000 during the year.
  3. Patents having a book value of ₹80,000 were sold for ₹1,10,000 during the year.

How much amount of the sales proceeds of the plant were added/subtracted?

Options:

₹20,000 added

₹20,000 subtracted

₹16,000 added

₹16,000 subtracted

Correct Answer:

₹16,000 added

Explanation:

The correct answer is option 3- ₹16,000 added.

A plant having a book value of ₹20,000 was sold for ₹16,000.
Cash inflow is added of ₹16,000 as it is sold for ₹16,000. ₹4000 is the loss which is non-cash expenditure.

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