Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Cash Flow Statement

Question:

Calculate cash flow from financing Activities of X Ltd. Which is a financing company.

Issue of shares 1,00,000
Issue of Bonus shares 50,000
Dividend paid 10,000
Interest paid 5,000
Options:

Rs 90,000

Rs 1,35,000

Rs 85,000

Rs 95,000

Correct Answer:

Rs 90,000

Explanation:

The correct answer is option (1) : Rs 90,000

Cash Flow from Financing Activities = (Issue of Shares ) - (Dividend Paid)

Cash Flow from Financing Activities = (1,00,000) - (10,000)
Cash Flow from Financing Activities = ₹90,000

* Interest paid is operating activity.
* Bonus shares are issued from reserves no use of cash.