Temperature modulated differential scanning calorimetry (TMDSC) is a recently developed method used to analyze thermal properties of materials such as heat capacity C-p and heat flow under isothermal or continuous heating conditions. However the method of measuring C-p in TMDSC and the separation of reversing heating flow (RHF) from non-reversing heat flow (NHF) depends on the precondition that the system is linear and the effect of non-reversing heat flow is also linear or very close to being so. In this paper, a numerical simulation method is used to study heat capacity C-p, NHF and RHF in various situations. It is found that using Fourier Transform to calculate C-p is applicable under steady state condition where there is no NHF. In the NHF releasing temperature range, the measured C-p value varies with different NHF patterns and modulation conditions even if C-p stays constant over the whole temperature range concerned. It appears that this method should be used with discretion in terms of the explanation of experimental results. Quantitative separation of RHF from NHF still remains a challenge if the mechanism of NHF and its effect on the system is not clear.