Page 6 - 27. COMPILER QB - IND AS 7

Consolidated balance sheet 20X2 20X1
Assets Amount (Rs) Amount (Rs)
Cash and cash equivalents 8,000 5,000
Trade receivables 54,000 50,000
Inventories 30,000 35,000

Property, plant and equipment 1,60,000 80,000
Goodwill 18,000 —
Total assets 2,70,000 1,70,000
Liabilities
Trade payables 68,000 60,000
Income tax payable 12,000 11,000
Long term debt 1,00,000 64,000
Total liabilities 1,80,000 1,35,000
Shareholders‖ equity 90,000 35,000
Total liabilities and shareholders’ 2,70,000 1,70,000

Other information:
All of the shares of entity B were acquired for Rs 74,000 in cash. The fair values of assets acquired and
liabilities assumed were:
Particulars Amount (Rs)
Inventories 4,000
Trade receivables 8,000

Cash 2,000
Property, plant and equipment 1,10,000
Trade payables (32,000)
Long term debt (36,000)
Goodwill 18,000
Cash consideration paid 74,000
Prepare the Consolidated Statement of Cash Flows for the year 20X2, as per Ind AS 7.

SOLUTION
This information will be incorporated into the Consolidated Statement of Cash Flows as follows:
Statement of Cash Flows for the year ended 20X2 (extract)

Amount (Rs) Amount (Rs)
Cash flows from operating activities
Profit before taxation 70,000
Adjustments for non-cash items:

Depreciation 30,000

Decrease in inventories (W.N. 1) 9,000

Decrease in trade receivables (W.N. 2) 4,000

Decrease in trade payables (W.N. 3) (24,000)

Interest paid to be included in financing activities 4,000

Taxation (11,000 + 15,000 – 12,000) (14,000)
79,000
Net cash generated from operating activities
Cash flows from investing activities

27. 5