The Summarised Balance Sheets of a company which has a good records of expansion are as under:

(Rs. in Lakhs)

Particulars 2007 2008 Assets (Rs.) (Rs.)

Land 33.60 36.00 Building 294.40 234.40 Machinery 89.20 58.00 Tools 10.60 17.80 Investments in Associated Company 5.32 4.60 Stock 50.40 52.32 Prepaid expenses 0.29 0.34 Debtors 58.24 38.56 Cash and Bank Balance 2.32 2.16 Discount on Debentures 0.50 0.60 Goodwill — 48.00 544.87 492.78 Liabilities:
Share Capital 268.00 196.00 Reserves 150.48 198.12 Provision for Depreciation 66.08 44.44 Debentures 37.00 25.00 Bank overdraft 2.28 1.63 Trade Creditors 6.27 14.88 Interest accrued but not paid 12.40 11.44 Provision for Doubful debts 1.08 0.55 Provision for Taxation 1.28 0.72 Total 544.87 492.78 Summarised Profit and Loss Account for the yeat ended 31-12-2008 is as follows (Rs. in lakh) (Rs. in lakh)
Sales 311.00 Manufacturing and other expenses 164.96 Selling and Distribution expenses 70.80 General Expenses 37.70 Interest of Debentures 1.80 Depreciation on Building Machinery and Tools 29.64 304.90 Net profit before tax 6.10 Provision for taxation 2.00 Net profit after tax 4.10 The chairman of the company is unable to determine the reason for the changes in working capital. You are requested to assist him and prepare a statement of sources and applications of funds for the 2008 together wih supporting schedules. On a scrutiny of records, the following information relating to 2008 accounts is found relevant for the purposes of your work. 1.

Machinery costing Rs. 1.08 lakh was scrapped and written off. Accumulated depreciation on this machinery was Rs. 80,000. 2.

There was an issue of capital during August 2008 at par. 3.

An interim dividend at 3.5% was paid in June 2008. 4.

There were no purchases or sale of tools during 2008. 5.

A small piece of land was sold for Rs. 2.40 lakh.