Mr. Berrybell wants to assess the ability of an enterprise named Anyway, so as to confirm whether the enterprise is capable to generate sufficient cash flows or not


Financial Accounting & Analysis

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1.     Mr. Berrybell wants to assess the ability of an enterprise named Anyway, so as to confirm whether the enterprise is capable to generate sufficient cash flows or not. Anyway submits the following information for the year ended 31 March2017.

Particulars                                                                    (Rs. In lacks)
Shares issued during the year                                              5
Capital assets purchased                                                   1.5
proceed from sale of an asset                                              2
Dividend declared and paid                                                 1
Increase in debtors                                                            1.5
loss on sale of asset                                                           0.2
net income before taxes                                                    8.8
Depreciation & Amortizations                                          3.8

Discuss the relevance of preparing the cash flow statement. Indicate and comment on the following
Cash from operation
Cash from investing activities
Cash from financing activities
Closing balance


2. You are being appointed as the accounts executive of Jayesh Motiwala & Company. The principal business of the company is dealing in pearl ornaments at its retail outlet in Jaipur. The management is unaware about the relevance of accounting standard applicable while accounting for the business. Your responsibility is to convince them to comply with the Accounting Standards, by giving a brief presentation on the objectives behind complying with the accounting standard and the benefits to the enterprise by following the same.


Ascertain -
a) Current ratio and liquid ratio. What if the industry average for the same is 2 and 1 respectively. (5 Marks)

b) Capital gearing ratio and interpret the same. (5 Marks)

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