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Cash Flow Statement

Question
CBSEENAC12000076
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What is meant by Cash from Operating Activities? 

Solution

Operating activities are the principal revenue producing activities of the enterprise. Cash flow from operating activities are derived from the principal revenue producing activities of the business. In other words, cash from Operating Activities means receipts of cash and cash equivalents in exchange of sale of produced goods and services.

Some More Questions From Cash Flow Statement Chapter

Under which type of activity will you classify Dividend received by a financial company while preparing Cash Flow Statement? 

What is meant by Cash from Operating Activities? 

State the purpose of preparing a Cash Flow Statement.

While preparing Cash Flow Statements what type of activity is, Payments of Cash to acquire Debentures by an investment company?

Give the meaning of 'Cash Flow'. 

State with reason whether deposit of cash into Bank will result into inflow, outflow or no flow of cash. 

‘An enterprise may hold securities and loans for dealing or trading purposes in which case they are similar to inventory acquired specifically for resale.” Is the statement correct? Cash flows from such activities will be classified under which type of activity which preparing Cash Flow Statements?

Give the meaning of ‘Cash Equivalents’ for the purpose of preparing Cash Flow Statement.

Following is the Balance Sheet of K K Ltd as at 31-3-2015:





Additional Information:
(i) 12% Debentures were redeemed on 31-3-2015
(ii) Tax 1,40,000 was paid during the year
Prepare Cash flow Statement

State whether the following will increase, decrease or have no effect on cash flow from operating activities while preparing 'Cash Flow Statement':

(i) Decrease in outstanding employees benefits expenses by ₹3,000
(ii) Increase in prepaid insurance by 2,000

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