Net Profit during the year ₹1,00,000, Debtors at the beginning of the year is ₹30,000, Debtors at the end of the year is ₹36,000. What is the amount of cash from operating activities?
Answer & explanation
Correct answer: option 1
The correct answer is option 1- ₹94,000
Increase in debtors have resulted in reduction of cash from operating activity.
Increase in debtors = 36,000 - 30,000
= 6,000
Cash flow from operating activity = Net profit - Increase in debtors
= 1,00,000 - 6,000
= 94,000