CUET CUET Accountancy 2024 - Calculate the resulting cash flow and state the nature of cash flow from the following information: Acquired machinery for ₹ 3,50,000 by issuing cheque. | PYQs + Solutions

CUET Accountancy 2024

Accountancy

Cash Flow Statement

Easy

Calculate the resulting cash flow and state the nature of cash flow from the following information: Acquired machinery for ₹ 3,50,000 by issuing cheque.

Investing activity and outflow ₹ 3,50,000

Investing activity and inflow ₹ 3,50,000

Investing activity and no flow

Operating activity and outflow ₹ 3,50,000

Correct Option: 1

To determine the cash flow from acquiring machinery, we look at the transaction details. The machinery was purchased for ₹ 3,50,000, and payment was made by issuing a cheque.

This means cash was paid out, resulting in a cash outflow.

Since the purchase of machinery is related to long-term assets, it falls under investing activities.

Therefore, the cash flow is:

Investing activity and outflow ₹ 3,50,000

The correct answer is Option 1.

CUET Accountancy 2024 PYQs

Calculate the resulting cash flow and state the nature of cash flow from the following information: Acquired machinery for ₹ 3,50,000 by issuing cheque.

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