Class 12 Accountancy NCERT Solutions Chapter 6 - Cash Flow Statement
FAQs on NCERT Solutions for Class 12 Accountancy Chapter 6 - Cash Flow Statement
1. What are the Three Types of Activity Classifications used During the Preparation of Cash Flow Statements?
The three types of activity classifications are:
Financing activities
Operating activities
Investing activities
2. How can I Download the Solution of Chapter 6 Accountancy Class 12?
To download the solutions of Chapter 6 Accountancy Class 12, simply install the Vedantu app and search for the chapter. You can download the solutions from the link that is mentioned on the page.
3. I had a Query Related to the Chapter. What Should I do?
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4. What is a Cash Flow Statement?
A Cash Flow Statement refers to a statement that shows the inflow and outflow of cash and the equivalents of cash from the financing, operating, and investing activities of the company. It records all the payments of cash and equivalents of cash that any business firm can incur during an accounting year. This cash flow of statements helps businesses to establish the ability and the position of the firm to generate cash for its needs.
5. Where can I find NCERT Solutions for Class 12 Accountancy Company Accounts and Analysis of Financial Statements Chapter 6?
Accounts is a difficult subject and students need to pay constant attention to this subject. Vedantu provides students with NCERT Solutions for Class 12 Accountancy Company Accounts and Analysis of Financial Statements Chapter 6. Students can access this through the online website or through the Vedantu mobile app. Students can even download a free PDF of NCERT Accountancy Class 12 NCERT Solutions Part 2 Chapter 6 from Vedantu. This book ensures that students learn and understand this chapter better.
6. Can you please brief the Class 12 Accountancy Chapter 6: Cash Flow Statement?
Cash Flow Statement is an important part of the Accountancy subject. This chapter will ensure that students will score good marks in their CBSE Board Examinations. This chapter provides students with the opportunity to learn about the cash flow statement. There are many important questions such as how one can prepare a cash flow statement, what is the meaning of a cash flow statement, and what are the objectives of it which are discussed in this chapter.
7. What is the meaning of Cash Equivalents?
Cash Equivalents refers to the investments that take place in a highly liquid nature. These investments do not change their value very easily. The investment is generally done on a promissory note with guaranteed returns. Cash Equivalents are important in order for investors to manage short term cash requirements. It is also important to keep track of any such investments. The best example of a cash equivalent would be treasury bills which are money market instruments that are issued by the Government of India.
8. What is the indirect method of asserting cash flow from operating activities?
Using the indirect method, a cash flow statement starts with a net income or loss. It then moves to the deduction or addition from that amount for all revenue items and non-cash expenses. This in turn results in cash flow from operating activities. Some of the operating activities can include provisions like discounts for debtors, expenses that are non-operating, and many more. In the indirect method, there are items that get deducted from the net profit P & L account.