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Cash Flow Statement
Accountancy
To calculate the value and increase/decrease; Opening Value of Balance Sheet - Closing Value of Balance Sheet Taken. But why for Trade Payable and Outstanding Liabilities the sequence was changed to Closing Value of Value Sheet - Opening Value of Balance Sheet?
Answers (7)
Thread Starter
A BI understood thankyouâ?¦ i was confused because of prepaid expenseâ?¦ I was thinking its expense then why not C - O ? When you told that Assets O - C and Liabilities C - O I understood; Prepaid Expense is Asset lolâ?¦
Yes prepaid expense is considered to be a short term asset.
Aswin Chandar
Yes prepaid expense is considered to be a short term asset.
And will you please tell me Depreciation value has been taken from â??attachedâ?? Or C - O of Accumulated Depreciation plus Depreciation of Plant 2000 given in adjustment
Thread Starter
A BAnd will you please tell me Depreciation value has been taken from â??attachedâ?? Or C - O of Accumulated Depreciation plus Depreciation of Plant 2000 given in adjustment
It can be directly taken from the question. As depreciation is a non cash expenses whatever depreciation is charged to P&L should be reversed/added back.
Aswin Chandar
It can be directly taken from the question. As depreciation is a non cash expenses whatever depreciation is charged to P&L should be reversed/added back.
Ok thankyou And last question sorry Why we didnt consider Reserves and Surplus for Increase/Decrease? I think because we already took net profit before taxation at start of question thats why we dont consider it. And i am thinking correctly na if any item in balance sheet is such that whose entry has already been passed through adjustments we need to ignore it for solving sum?
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