Financial Transactions

1. Purchase of Machinery

The purchase of machinery involves an outflow of cash and is classified under investing activities. The transaction is recorded when a company spends money to acquire new machinery, which is considered a long-term asset. The purchase price, along with any additional costs such as transportation and installation, is included in the total cost of the machinery.

2. Proceeds from Issue of Equity Share Capital

This transaction involves cash inflow from the issuance of equity shares to investors. It is classified under financing activities. The funds raised through the issue of equity share capital can be used by the company for various purposes, including expansion, paying off debt, or other operational needs. The amount received from investors is recorded as an increase in the equity share capital of the company.

3. Cash Revenue from Operations

Cash revenue from operations is the cash inflow generated from the primary business activities of the company, such as the sale of goods and services. This is a crucial indicator of the company's operational efficiency and is classified under operating activities. It excludes non-operating income like interest or dividends received.

4. Proceeds from Long-Term Borrowings

Proceeds from long-term borrowings represent cash inflows from loans or debt instruments that are to be repaid over a period longer than one year. This transaction is categorized under financing activities. The funds obtained can be used for various purposes, such as capital expenditures or expanding operations.

5. Proceeds from Sale of Old Machinery

This transaction involves cash inflow from selling old or obsolete machinery. It is classified under investing activities. The sale proceeds are recorded after deducting any related expenses, such as dismantling or removal costs, from the selling price of the machinery.

6. Cash Receipt from Trade Receivables

Cash receipts from trade receivables represent the collection of cash from customers for sales made on credit. This is an operating activity as it pertains to the core business operations. Efficient collection of receivables is crucial for maintaining the company's cash flow.

7. Trading Commission Received

Trading commission received is the income earned from facilitating transactions or sales on behalf of others. This cash inflow is considered part of the operating activities since it relates to the company’s regular business operations. The commission is recorded as revenue when earned.

8. Purchase of Non-Current Investment

The purchase of non-current investments involves cash outflows for acquiring long-term investments such as stocks, bonds, or real estate. This transaction is categorized under investing activities. The purpose of these investments is usually to earn returns over a longer period.

9. Redemption of Preference Shares

Redemption of preference shares involves cash outflows for repaying the capital invested by preference shareholders. This is classified under financing activities. The redemption amount includes any premium paid over the face value of the shares.

10. Cash Purchases

Cash purchases refer to buying goods or services by paying cash at the time of purchase. This is an operating activity as it relates to the company's primary business operations. Efficient management of cash purchases is important for maintaining liquidity.

11. Proceeds from Sale of Non-Current Investment

This transaction involves cash inflow from selling long-term investments such as stocks, bonds, or real estate. It is classified under investing activities. The proceeds are recorded after deducting any selling expenses from the sale price of the investment.

12. Purchase of Goodwill

Goodwill purchase involves cash outflows for acquiring intangible assets that represent the value of a business's brand, customer base, or other intangible factors. This is categorized under investing activities. Goodwill is recorded when the purchase price exceeds the fair value of the net identifiable assets acquired.

13. Cash Paid to Supplier

Cash payments to suppliers represent outflows of cash for purchasing goods or services needed for the company's operations. This is classified under operating activities. Timely payments to suppliers are crucial for maintaining good supplier relationships and ensuring smooth business operations.

14. Interim Dividend Paid on Equity Shares

Interim dividends are payments made to shareholders before the company's annual general meeting and final financial statements. The cash outflow from paying these dividends is classified under financing activities. It represents a distribution of profits to equity shareholders.

15. Employee Benefits Expenses Paid

Cash outflows for employee benefits include salaries, wages, bonuses, and other benefits paid to employees. This is an operating activity as it relates to the company’s primary business operations. Efficient management of employee expenses is essential for controlling operating costs.

16. Proceeds from Sale of Patents

This transaction involves cash inflow from selling patents owned by the company. It is classified under investing activities. The proceeds are recorded after deducting any costs associated with the sale of the patents.

17. Interest Received on Debentures Held as Investments

Interest received from debentures held as investments represents cash inflows from interest payments on debt securities. This is categorized under investing activities. The interest income is recorded when earned, regardless of when it is received.

18. Interest Paid on Long-Term Borrowings

Interest payments on long-term borrowings represent cash outflows for interest expenses on loans or debt instruments. This transaction is classified under financing activities. Efficient management of interest payments is crucial for maintaining the company’s financial health.

19. Office and Administrative Expenses Paid

Cash outflows for office and administrative expenses include costs related to the general operation of the business, such as rent, utilities, and office supplies. This is an operating activity as it pertains to the company’s primary business operations.

20. Manufacturing Overheads Paid

Cash payments for manufacturing overheads include costs indirectly associated with the production process, such as utilities, maintenance, and factory supplies. This is classified under operating activities. Effective management of overhead costs is essential for maintaining profitability.

21. Dividend Received on Shares Held as Investment

Dividends received from shares held as investments represent cash inflows from investments in other companies' equity. This transaction is categorized under investing activities. The dividend income is recorded when declared by the issuing company.

22. Rent Received on Property Held as Investment

Rent received from property held as investment represents cash inflows from leasing property owned by the company. This is classified under investing activities. The rental income is recorded when earned, regardless of when it is received.

23. Selling and Distribution Expenses Paid

Cash outflows for selling and distribution expenses include costs related to marketing, advertising, and distribution of the company's products. This is an operating activity as it pertains to the company’s primary business operations.

24. Income Tax Paid

Cash payments for income tax represent outflows of cash for taxes levied on the company's earnings. This transaction is classified under operating activities unless it can be specifically identified with financing or investing activities. Timely tax payments are crucial for compliance and avoiding penalties.

25. Dividend Paid on Preferences Shares

Dividend payments on preference shares involve cash outflows for distributing profits to preference shareholders. This is classified under financing activities. Preference dividends are typically fixed and paid before any dividends to equity shareholders.

26. Underwriting Commission Paid

Cash payments for underwriting commissions represent outflows of cash to underwriters who facilitate the issuance of new securities. This transaction is categorized under financing activities. The commission expense is recorded as part of the cost of raising capital.

27. Rent Paid

Cash outflows for rent payments include costs for leasing office space, equipment, or other property. This is an operating activity as it pertains to the company’s primary business operations. Efficient management of rent expenses is essential for controlling operating costs.

28. Brokerage Paid on Purchase of Non-Current Investment

Brokerage payments for purchasing non-current investments involve cash outflows for fees paid to brokers or agents. This transaction is classified under investing activities. The brokerage expense is recorded as part of the cost of acquiring the investment.

29. Bank Overdraft

A bank overdraft represents a short-term borrowing facility allowing the company to withdraw more money than it has in its account. This transaction is classified under financing activities. Efficient management of overdraft facilities is crucial for maintaining liquidity.

30. Amortization of Patent

Amortization of patents involves the systematic allocation of the cost of a patent over its useful life. This is an accounting adjustment rather than a cash flow. However, it is important for calculating the net income and assessing the profitability of the company.

31. Loss on Issue of Debentures

A loss on the issue of debentures represents the difference between the issue price and the nominal value of the debentures, recorded as an expense. This is an accounting adjustment rather than a cash flow. The loss is recognized in the financial statements to reflect the true cost of raising capital.

32. Premium on Redemption of Debentures

Premium on the redemption of debentures involves cash outflows for paying more than the nominal value to redeem debentures. This transaction is classified under financing activities. The premium expense is recorded as part of the cost of redeeming the debt.

33. Calls in Arrears

Calls in arrears represent unpaid amounts on shares that have been called up by the company. This is a receivable amount and an adjustment rather than a cash flow. The company records this as an asset until the amount is collected from the shareholders.

34. Final Dividend on Equity Shares

Final dividends on equity shares involve cash outflows for distributing profits to equity shareholders. This is classified under financing activities. Final dividends are declared at the company’s annual general meeting and paid after the financial statements are finalized.

35. Proceeds from Issue of Debentures

Proceeds from the issue of debentures represent cash inflows from issuing debt instruments. This transaction is categorized under financing activities. The funds raised can be used for various purposes, such as capital expenditures or debt refinancing.

36. Interim Dividend Received

Interim dividends received represent cash inflows from dividend payments made by companies in which the company holds investments. This transaction is categorized under investing activities. The interim dividend income is recorded when received.