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In cash flow que 53 how calculate Proposed dividend 23000

Asked by Smitakhadayate20 8th January 2019, 7:35 PM
Answered by Expert
The effect of proposed dividend on Cash Flow Statement is as follows:
i. proposed dividend for previous year is shown as an outflow of cash assuming that the shareholders have approved the proposed dividend. Therefore, proposed dividend for the year ended 31.03.2017 Rs.14,000 will be shown as an outflow.
ii. proposed dividend for current year is not given any effect as it is not provided for. Therefore, Rs.25,000 proposed for the current year is not given any effect in the cash flow statement.
Also, it is given in the question that interim dividend paid during the year is Rs.9,000.Therefore, total outflow with respect to dividends for the current year will be total of dividend proposed for previous year and interim dividend paid for current year which is Rs.23,000 (Rs.14,000+Rs. 9,000). Such 23,000 is therefore shown as an outflow in financing activities and added in operating activities to derive operating profits.
Answered by Expert 9th January 2019, 11:08 AM
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