Skip to content

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

Himalaya Foods Ltd (non-financial) had these cash items in FY 2025-26: interest paid Rs 18 lakh, interest received Rs 7 lakh, dividend received Rs 3 lakh, dividend paid Rs 20 lakh. Cash flow from operations before these items was Rs 150 lakh. Applying Ind AS 7, what are net cash from operating activities, net investing effect of these items, and net financing effect of these items respectively?

Operating cash flow remains Rs 150 lakh, investing shows a net inflow of Rs 10 lakh from interest and dividends received, and financing shows a net outflow of Rs 38 lakh from interest and dividends paid. Ind AS 7 places all four items outside operating activities.

  1. ARs 150 lakh; inflow Rs 10 lakh; outflow Rs 38 lakhCorrect
  2. BRs 132 lakh; inflow Rs 10 lakh; outflow Rs 20 lakh
  3. CRs 150 lakh; inflow Rs 7 lakh; outflow Rs 38 lakh
  4. DRs 142 lakh; inflow Rs 3 lakh; outflow Rs 38 lakh

Explanation

Operating stays Rs 150 lakh because none of these items is operating. Investing = interest received 7 + dividend received 3 = inflow Rs 10 lakh. Financing = interest paid 18 + dividend paid 20 = outflow Rs 38 lakh. Option B wrongly treats interest paid as operating.

Did you get it right without looking?

One question tells you little. A timed set on Ind AS 7 Statement of Cash Flows shows your real accuracy, how long you take and where you lose marks.

Practise Ind AS 7 Statement of Cash FlowsFree diagnostic mock

More Ind AS 7 Statement of Cash Flows questions