Determine cash flow operating activities from the following information.

Profit during the year was ₹3,70,000.

₹3,50,000

The correct answer is option 1- ₹3,50,000.

Net Profit before Taxation and Extraordinary Items = 3,70,000
As there is not non cash expenses so the Operating Profit before working capital changes will be same 3,70,000
– Increase in Inventories (30,000)
+ Increase in Trade Payables 10,000
Net cash from Operating Activities = 3,70,000 - 30,000 + 10,000
                                                      = ₹3,50,000

• Goodwill affects investing activity
• Debentures and shares affects financing activity