fund flow

This query is : Resolved

CA Vijeta Verma (Querist)
Follow

02 December 2009 dear sir/ma'am
my ques relates to fund flow statement,its regarding the treatment
of TRADE INVESTMENTS
in the que following info. are given:
op bal of trade investment=Rs105000
cl bal of trade investment=Rs40000
as per income statement gain on sale of investment=R6400
is there any treatment of these adjustment to be done in ADJUSTED P& L A/C, FUND FLOW STATEMENT??

thanks
vijeta verma
pcc student

CA. SUDHARSAN K G

CA. SUDHARSAN K G (Expert)
Follow

02 December 2009 Vijeta Verma

Try to understand the following:

Opening Balance of Trade Investment Rs. 1,05,000/-
Closing Balance of Trade Investment Rs. 40,000/-
Gain on Sale of Investment Rs. 6, 400/-

In Fund Flow Statement,
Sources of Funds:
Sale of Investments Rs. 71,400/-

In Adjusted P&L A/c:
By Profit on Sale Rs. 6,400/-

The Ultimate logic behind this is,
You received the funds on account of Rs. 1,51,400/- So, it is shown as above.
In the same way, you should know how much you earned from the operations, hence you should add to the adjusted P&L A/c as follows.

To Depreciation XXX By Balance b/d XXX
To Loss on Sale XXX By Profit on Sale 6400
To Bal c/d XXX By Adj P&L (Bal) XXX

Hope, you understand it logiclly.

Anjani Pratap Tiwari

Anjani Pratap Tiwari (Expert)
Follow

03 December 2009 Your Opening Balance is 105000
Closing is 40000
Profit on sale is 6400
That means Sales amount of Investement is (105000-40000+6400)=71400/-

So your Inflow from sale of investment is 71400/- i.e. source of Funds

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Join the CA Students WhatsApp Community for ICAI Updates, Trending Courses & Notes!

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

MAYANK

Vivekanand Sagar

nilesh

yadagiri

Mohit Kumar

Subscribe Now

fund flow

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

Senior Executive

Manager- Finance and Compliance

GST CONSULTANT

GST CONSULTANCY

Accountant

CA Final

Article Assistant

Associate CA