Cashflows

This topic has 2 replies, 2 voices, and was last updated 1 month ago by P2-D2.

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June 29, 2022 at 3:52 pm #659520
lokeshdh00
- Topics: 105
- Replies: 95
Hello Crish, I hope you are doing well. I am so far loving your lectures. I stuck at a line you said, ” Intrest received and dividend received are invenstment incoe and it would need to be adjusted for any opening or closing receivables in a T-account” . There are quite high chances i mishead it. and i am aware cashflows are not frequently examined. but I am losing my mind over it like i will mess up at this very point if t will be exmained ever.

I didn’t understand how interst income has to do with receivables and how it would appear in a t-account ?

yeah intrest payable T account is needed to find the interst paid during the year in cash but i didmn’t understand that about intrest receivable or Dividend receivable.

All i can make up is , sum of dividend and intrest received would be “investment income” and it would appear in operating activities just after PFY.

thank you very much for being here.
June 30, 2022 at 5:46 pm #659686
lokeshdh00
- Topics: 105
- Replies: 95
Ohh i understood, the dividend receivable is to check if there is any dividend receviable balance in current assest ( like we check for intrest payable in current liability ) to see if we received any dividend through T account, I don’t know why it didn’t hit me earlier, in example video it is cleared now.
I am more than happy if you want to add anything to it.

Thank you very much Sir
July 1, 2022 at 3:30 pm #659751
P2-D2
Keymaster
- Topics: 4
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Correct! We are adjusting the income in profit or loss for any opening/closing balances. As you say, cashflow is not now tested as a full question and if it is seen then it will be in section A or B, so only worth a handful of marks. That said, it is still worth investing a bit of time in the section in case it does arise as it is usually some easy marks to achieve.

Thanks and I hope you continue to enjoy the lectures. Looking forward to helping you out in the coming months.
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