Cash Flow from Investing Activities includes flow of cash which arises due to purchase or sale of fixed assets like land, building, plant & machinery etc. It is an important aspect of growth and capital. It includes only cash transactions and not any credit transactions. Cash flow from investing activities examples are:
- Cash receipts from sale of fixed assets
- Payment made in cash to acquire fixed assets
- Cash advances and loans made to third parties
- Payments made in cash to acquire shares, warrants or debt instruments of other enterprises
- Cash received on account of interests and dividends
- Receipts in cash of insurance claims of third parties
- Cash receipt from sale of fixed assets
Cash Flow from Investing Activities Example: 1
Following is the information available from the books of Akash Ltd.
Cash flow from investing activities will be:
Explanation : –
Cash Flow from Investing Activities Example: 2
Cash flow from investing activities from the following information will be:
Explanation : –
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Cash Flow from Investing Activities Example:Â 3
Following is the information available from ABC Ltd
Additional information:
1 Half of the investment held in the beginning of the year was sold at a profit of 2 %.
2 Depreciation on fixed Assets was Rs 100000 for the year
3 Interest received on investment was Rs 90000
4 Dividend received on investment Rs 70000
Cash flow from Investing activities will be:
Explanation : –
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Cash Flow from Investing Activities Example: 4
AB Ltd had the following balances
During the year, the company had sold 20 % of its investment at a profit of Rs 21000 .Calculate cash flow from operating activity and cash flow from investing activity if company earned a profit of Rs 50000 during the year will be:
Explanation : –
Cash Flow from Investing Activities Example:Â 5
Following is the information relating to Akash Ltd
During the year a Machine sold for Rs 45000 On which Accumulated depreciation was Rs 67500 .
Depreciation charged on machinery during the year is:
Explanation : –
Cash Flow from Investing Activities Example:Â 6
From the following information what will be the amount of asset purchased during the year
Additional information
1 During the year a machine costing Rs 30000 accumulated deprecation Rs 22000 was sold for Rs 9500
Explanation : –
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