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CA Final · Financial Reporting · Ind AS 7 Statement of Cash Flows

Ganga Pharma Ltd received dividend of ₹8 lakh from its investments in shares of other companies and paid dividend of ₹25 lakh to its own shareholders. Other net operating cash flow was ₹100 lakh and no other cash flows occurred. Applying Ind AS 7 classification, what is the net cash flow from operating activities?

Net operating cash flow is ₹100 lakh. Under Ind AS 7, dividend received is classified as investing and dividend paid as financing, so neither enters operating activities and the other net operating cash flow stands unchanged.

  1. A₹83 lakh
  2. B₹100 lakhCorrect
  3. C₹108 lakh
  4. D₹75 lakh

Explanation

Under Ind AS 7, dividend received is an investing item and dividend paid is a financing item. Neither affects operating activities, so operating cash flow remains ₹100 lakh. Adding the ₹8 lakh gives ₹108 lakh, and deducting ₹25 lakh gives ₹75 lakh; both are wrong because they use IAS 7 options.

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