From the following information, calculate cash flow from Investing Activities :
March 31, 2021 March 31, 2022
Land (at cost) ₹ 20,00,000 ₹ 16,00,000
Land was sold at a profit of ₹ 3,20,000.

Correct option is A

· Book value of land sold: This is the decrease in the value of the land shown on the balance sheet.
· Opening Balance (March 31, 2021) = ₹20,00,000
· Less: Closing Balance (March 31, 2022) = ₹16,00,000
· Book value of land sold = ₹4,00,000
· Profit on sale: ₹3,20,000
· Cash inflow from sale: To get the total cash inflow, add the profit on the sale to the book value of the land sold.
· Cash inflow = Book Value of Land Sold + Profit on Sale
· Cash inflow = ₹4,00,000 + ₹3,20,000 = ₹7,20,000 
Therefore, the cash flow from Investing Activities is an  Inflow of ₹7,20,000.
The correct option is  (a) Inflow of ₹7,20,000.