question_answer

Holyname Ltd made an operating profit of Rs. 2,00,000 after charging depreciation of Rs. 22,000. During that year, trade payables increased by Rs. 27,200 and inventory increased by Rs. 75,000. There was no change in trade receivables. Assuming that no other factors affected it, what would be the cash generated from operations?

Answer:

Cash Generated from Operations	Amt (Rs.)
Operating Profit	2,00,000
(+) Depreciation	22,000
	2,22,000
(-) Increase in inventory	(75,000)
	1,47,000
(+) Increase in Trade Payables	27,200
	1,74,200