If the profits made during the year are ₹50,000 and the bills receivables have decreased by ₹10,000 during the year then the cash flow from operating activities will be:
Answer & explanation
Correct answer: option 3
The correct answer is option 3- ₹60,000.
Profit = 50,000
B/R decrease = 10,000
Decrease in current assets are added to calculate the cash flow from operating activity. So, cash flow from operating activity = 50,000 + 10,000
= 60,000