JC Ltd. earned a net profit of ₹ $\displaystyle 50,000$ after providing depreciation of 2n $\displaystyle 20,000$ on fixed assets and a transfer of ₹ $\displaystyle 15,000$ to general reserve. The position of its Current Assets and Current Liabilities was as follows : $\displaystyle 31.03.2025$ $\displaystyle 31.03.2024$ Particulars ( ) ( ) Trade Receivables $\displaystyle 75,000$ $\displaystyle 70,000$ Trade Payables $\displaystyle 75,000$ $\displaystyle 65,000$ Inventories $\displaystyle 40,000$ $\displaystyle 25,000$ Expenses Payable $\displaystyle 7,500$ $\displaystyle 5,000$ Prepaid Expenses $\displaystyle 5,000$ $\displaystyle 10,000$ Accrued Incomes $\displaystyle 20,000$ $\displaystyle 15,000$ Income Received in Advance $\displaystyle 5,000$ $\displaystyle 10,000$ Calculate cash flows from operating activities.

Cash Flow from Operating Activities Particulars Amount Amount (`) (`) Net Profit Before Tax (Working Note $\displaystyle 1$) $\displaystyle 65,000$ ($\displaystyle 1$) Add: Depreciation $\displaystyle 20,000$ ($\displaystyle 1$/$\displaystyle 2$) Operating Profit before Working Capital changes $\displaystyle 85,000$ ($\displaystyle 1$/$\displaystyle 2$) Add: Increase in Current Liabilities and Decrease in Current Assets Increase in Trade Payables $\displaystyle 10,000$ ($\displaystyle 1$/$\displaystyle 2$) Increase in Expense Payable $\displaystyle 2,500$ ($\displaystyle 1$/$\displaystyle 2$) Decrease in Prepaid Expenses $\displaystyle 5,000$ ($\displaystyle 1$/$\displaystyle 2$) $\displaystyle 17,500$ Less: Decrease in Current Liabilities and Increase in Current Assets Increase in Trade Receivable $\displaystyle (5,000)$ ($\displaystyle 1$/$\displaystyle 2$) Increase in Inventories $\displaystyle (15,000)$ ($\displaystyle 1$/$\displaystyle 2$) Increase in Accrued Income $\displaystyle (5,000)$ ($\displaystyle 1$/$\displaystyle 2$) Decrease in Income Received in Advance $\displaystyle (5,000)$ ($\displaystyle 1$/$\displaystyle 2$) $\displaystyle (30,000)$ Cash inflows from operating activities $\displaystyle 72,500$ ($\displaystyle 1$/$\displaystyle 2$) Calculation of Cash Flow from Operating Activities: Working Note $\displaystyle 1$: Calculation of Net Profit Before Tax + = +$\displaystyle 15,000$ Net Profit General Reserve $\displaystyle 50,000$ = `$\displaystyle 65,000$ PART B OPTION II (Computerised Accounting)