The Balance Sheets of Kumari Co. Ltd. as on 31st Dec 2020 and 31st Dec 2021 were as follows:

| Liabilities | 2020 | 2021 | Assets | 2020 | 2021 |
|---------------------|----------|----------|-------------------|----------|----------|
| Equity Share capital| ₹1,80,000| ₹2,60,000| Fixed assets | ₹1,86,800| ₹3,32,000|
| General Reserve | ₹20,000 | ₹30,000 | Stock | ₹44,000 | ₹52,000 |
| Profit & Loss A/c | ₹40,000 | ₹60,000 | Sundry debtors | ₹72,000 | ₹78,000 |
| 12% debenture | | ₹40,000 | Bank | ₹8,000 | ₹10,000 |
| Creditors | ₹74,800 | ₹84,000 | Preliminary Expenses| ₹4,000 | ₹2,000 |
| | ₹3,14,800| ₹4,74,000| | ₹3,14,800| ₹4,74,000|

Additional Information:
1. Dividend of ₹40,000 was paid on equity share capital.
2. Depreciation written off on fixed assets was ₹46,800.

Prepare a schedule of changes in working capital and a fund flow statement.

Alright, let's analyze and prepare the requested financial statements step-by-step.

### Step 1: Calculate the Working Capital for 2020 and 2021

Working Capital is calculated as the difference between current assets and current liabilities.

#### Current Assets:
- 2020: Stock + Sundry Debtors + Bank
[tex]\[ 2020\ \text{current assets} = ₹ 44,000 + ₹ 72,000 + ₹ 8,000 = ₹ 1,24,000 \][/tex]

- 2021: Stock + Sundry Debtors + Bank
[tex]\[ 2021\ \text{current assets} = ₹ 52,000 + ₹ 78,000 + ₹ 10,000 = ₹ 1,40,000 \][/tex]

#### Current Liabilities:
- 2020: Creditors
[tex]\[ 2020\ \text{current liabilities} = ₹ 74,800 \][/tex]

- 2021: Creditors
[tex]\[ 2021\ \text{current liabilities} = ₹ 84,000 \][/tex]

#### Working Capital:
- 2020:
[tex]\[ 2020\ \text{working capital} = ₹ 1,24,000 - ₹ 74,800 = ₹ 49,200 \][/tex]

- 2021:
[tex]\[ 2021\ \text{working capital} = ₹ 1,40,000 - ₹ 84,000 = ₹ 56,000 \][/tex]

#### Change in Working Capital:
[tex]\[ 2021\ \text{working capital} - 2020\ \text{working capital} = ₹ 56,000 - ₹ 49,200 = ₹ 6,800 \][/tex]

### Step 2: Sources and Applications of Funds in the Fund Flow Statement

#### Sources of Funds:
1. Funds from Operations:
- 2021 Profit & Loss A/c - 2020 Profit & Loss A/c + Depreciation Written Off:
[tex]\[ ₹ 60,000 - ₹ 40,000 + ₹ 46,800 = ₹ 66,800 \][/tex]

2. Funds from Issue of Shares:
- 2021 Equity Share Capital - 2020 Equity Share Capital:
[tex]\[ ₹ 2,60,000 - ₹ 1,80,000 = ₹ 80,000 \][/tex]

3. Funds from Reserves:
- 2021 General Reserve - 2020 General Reserve:
[tex]\[ ₹ 30,000 - ₹ 20,000 = ₹ 10,000 \][/tex]

4. Increase in Creditors:
- 2021 Creditors - 2020 Creditors:
[tex]\[ ₹ 84,000 - ₹ 74,800 = ₹ 9,200 \][/tex]

#### Total Sources of Funds:
[tex]\[ ₹ 66,800 + ₹ 80,000 + ₹ 10,000 + ₹ 9,200 = ₹ 1,66,000 \][/tex]

#### Applications of Funds:
1. Purchase of Fixed Assets:
- 2021 Fixed Assets - 2020 Fixed Assets:
[tex]\[ ₹ 3,32,000 - ₹ 1,86,800 = ₹ 1,45,200 \][/tex]

2. Decrease in Preliminary Expenses:
- 2021 Preliminary Expenses - 2020 Preliminary Expenses:
[tex]\[ ₹ 2,000 - ₹ 4,000 = -₹ 2,000 \][/tex]

3. Dividend Paid:
[tex]\[ ₹ 40,000 \][/tex]

#### Total Applications of Funds:
[tex]\[ ₹ 1,45,200 - ₹ 2,000 + ₹ 40,000 = ₹ 1,83,200 \][/tex]

#### Net Fund Flow:
[tex]\[ \text{Total Sources} - \text{Total Applications} = ₹ 1,66,000 - ₹ 1,83,200 = -₹ 17,200 \][/tex]

### Summary:
- Working Capital 2020: ₹ 49,200
- Working Capital 2021: ₹ 56,000
- Change in Working Capital: ₹ 6,800
- Funds from Operations: ₹ 66,800
- Funds from Issue of Shares: ₹ 80,000
- Funds from Reserves: ₹ 10,000
- Increase in Creditors: ₹ 9,200
- Purchase of Fixed Assets: ₹ 1,45,200
- Preliminary Expenses: -₹ 2,000
- Dividend Paid: ₹ 40,000
- Total Sources: ₹ 1,66,000
- Total Applications: ₹ 1,83,200
- Net Fund Flow: -₹ 17,200