Question : Deva and Co., a pen-producing company, purchased machinery for Rs.9,00,000. It receives a dividend of Rs.70,000 on investment in shares. The company also sold an old machine with a book value of Rs.79,000 at a loss of Rs.10,000. Compute the amount of cash flow used from/in investing activities -
Option 1: Rs.(7,61,000)
Option 2: Rs.7,61,000
Option 3: Rs.(7,11,000)
Option 4: Rs.7,11,000
Correct Answer: Rs.(7,61,000)
Solution :
| Particulars | Amount |
| Inflows: | |
| Dividend received | 70000 |
| Sale of old machinery | 69000 |
| Outflows: | |
| Purchase of machinery | (900000) |
| Net cash flow from investing activities | (761000) |
Hence the correct answer is option 1.




