Outflow/Applications of Funds |
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Outflow/Applications of Funds |
There will be an outflow, when, on account of the transaction, there is
| Balance Sheet of M/s __ as on 30th June __ | |||
|---|---|---|---|
| Liabilities | Amount | Assets | Amount |
| Non-Current Liabilities Current Liabilities | 89,00,000 15,00,000 | Non-Current Assets Current Assets | 80,00,000 24,00,000 |
| 1,04,00,000 | 1,04,00,000 | ||
From the above balance sheet,
| Working Capital | = | Current Assets - Current Liabilities |
| = | 24,00,000 - 15,00,000 | |
| = | 9,00,000 | |
| (Or) | = | Non-Current Liabilities - Non-Current Assets |
| = | 89,00,000 - 80,00,000 | |
| = | 9,00,000 |
| Dr. Fixed Asset a/c Cr. Cash a/c | Non-Current Asset Current Asset | Increase Decrease |
After taking into account the affect of the above transaction,
| Current Assets (Changed) | = | Current Assets (old) - Decrease |
| = | 24,00,000 - 50,000 | |
| = | 23,50,000 |
| Non-Current Asset (Changed) | = | Non-Current Asset (old) + Increase |
| = | 80,00,000 + 4,00,000 | |
| = | 84,00,000 |
| Working Capital (Changed) | = | Current Assets (Changed) - Current Liabilities |
| = | 20,00,000 - 15,00,000 | |
| = | 5,00,000 | |
| (Or) | = | Non-Current Liabilities - Non-Current Assets (Changed) |
| = | 89,00,000 - 84,00,000 | |
| = | 5,00,000 |
Working capital has changed from 9,00,000 to 5,00,000.
| Dr. Fixed Asset a/c Cr. Bills Payable a/c | Non-Current Asset Current Liability | Increase Increase |
After taking into account the affect of the above transaction,
| Non-Current Assets (Changed) | = | Non-Current Assets (old) + Increase |
| = | 80,00,000 + 5,00,000 | |
| = | 85,00,000 |
| Current Liability (Changed) | = | Current Liability (old) + Increase |
| = | 15,00,000 + 5,00,000 | |
| = | 20,00,000 |
| Working Capital (Changed) | = | Current Assets - Current Liabilities (Changed) |
| = | 24,00,000 - 20,00,000 | |
| = | 4,00,000 | |
| (Or) | = | Non-Current Liabilities - Non-Current Assets (Changed) |
| = | 89,00,000 - 85,00,000 | |
| = | 4,00,000 |
Working capital has changed from 9,00,000 to 4,00,000.
| Dr. Long Term Loan a/c Cr. Bank a/c | Non-Current Liability Current Asset | Decrease Decrease |
After taking into account the affect of the above transaction,
| Current Assets (Changed) | = | Current Assets (old) - Decrease |
| = | 24,00,000 - 2,35,000 | |
| = | 21,65,000 |
| Non-Current Liability (Changed) | = | Non-Current Liability (old) - Decrease |
| = | 89,00,000 - 2,35,000 | |
| = | 86,65,000 |
| Working Capital (Changed) | = | Current Assets (Changed) - Current Liabilities |
| = | 21,65,000 - 15,00,000 | |
| = | 6,65,000 | |
| (Or) | = | Non-Current Liabilities (Changed) - Non-Current Assets |
| = | 86,65,000 - 80,00,000 | |
| = | 6,65,000 |
Working capital has changed from 9,00,000 to 6,65,000.
| Dr. Partners Capital a/c Cr. Bills Payable a/c | Non-Current Liability Current Liability | Decrease Increase |
After taking into account the affect of the above transaction,
| Current Liabilities (Changed) | = | Current Liabilities (old) + Increase |
| = | 15,00,000 + 1,20,000 | |
| = | 16,20,000 |
| Non-Current Liabilities(Changed) | = | Non-Current Liabilities (old) - Decrease |
| = | 89,00,000 - 1,20,000 | |
| = | 87,80,000 |
| Working Capital (Changed) | = | Current Assets - Current Liabilities (Changed) |
| = | 24,00,000 - 16,20,000 | |
| = | 7,80,000 | |
| (Or) | = | Non-Current Liabilities - Non-Current Assets (Changed) |
| = | 87,80,000 - 80,00,000 | |
| = | 7,80,000 |
Working capital has changed from 9,00,000 to 7,80,000.
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