Question

If the Opening Debtors were Rs.50,000 and Closing

Q: Answer-If the Opening Debtors were Rs.50,000 and Closing debtors are Rs.40,000, what effect will it have on...

Change in debtors is a working capital change which will reflect under operating cash flow. Here, the change in the debtors decrease in debtors by Rs.10,000 opening Rs.50,000 less closing Rs.40,000. A decrease in current assets here debtors indicated the decreased cash blockage or recovery of cash from debtors. This will be taken as an implicit inflow under Working Capital changes.

debtors are Rs.40,000, what effect will it have on the cash flow statement?

A Cash flow from operating activities will be increased by Rs.10,000

B Cash flow from operating activities will be decreased by Rs.10,000

C Cash flow from operating activities will be increased by Rs.50,000

D Cash flow from operating activities will be decreased by Rs.50,000

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If the Opening Debtors were Rs.50,000 and Closing

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