The correct answer is Option (2) - (B), (E), (A), (C), (D).
(B) Net profit before tax and extra ordinary items
(E) Operating profit before working capital changes
(A) Income Tax paid
(C) Cash flow from Investing Activity
(D) Cash flow from Financing Activity
This is the correct sequence of preparing cash flow statement-
(1) Cash flows from operating activities
(2) Cash flows from investing activities
(3) Cash flows from financing activities
Net increase (decrease) in cash and cash equivalents (1 + 2 + 3)
+ Cash and cash equivalents at the beginning
= Cash and cash equivalents at the end.
Performa of calculating cash flows from operating activities as per indirect method.
| |
Particulars |
Amount |
| |
Net Profit/Loss before Tax and Extraordinary Items |
|
| Add |
Deductions already made in Statement of Profit and Loss on account of Non-cash
items such as Depreciation, Goodwill to be Written-off. |
|
| Add |
Deductions already made in Statement of Profit and Loss on Account of
Non-operating items such as Interest. |
|
| Less |
Additions (incomes) made in Statement of Profit and Loss on Account of
Non-operating items such as Dividend received, Profit on sale of Fixed Assets. |
|
| |
Operating Profit before Working Capital changes |
|
| Less |
in case of increase in current assets (other than cash and cash equivalent)
and decrease in current liabilities |
|
| Add |
in case of decrease in current assets (other than cash and cash equivalent)
and increase in current liabilities. |
|
| |
Cash Flows from Operation Activities before Tax and Extraordinary items |
|
| Less |
Income Tax Paid |
|
| +/– |
Effects of Extraordinary Items |
|
| |
Net Cash from Operating Activities |
|
| 
