Reg the second part of your question, if Tata pays Rs.5 crores for a IT project the company's cash balance comes down by that much in the respective month. However the entire 5 crores is not operating expense since the work takes 6 months to complete and the 5 crores should be divided among that 6 months. Hence only 83.3 lakhs is subtracted from the net income. Is that clear ?
Nov 20 2012 02:47 PM