Accounting Grade 12 Paper 2 KZN Prelim 2022 Question Paper

Downloaded from hlayiso.com EDUCATION REPUBLIC OF SOUTH AFRlCA NATIONAL SENIOR CERTIFICATE [ GRADE 12 ] II II II II II II II II II II II II II II II II 2022 II II ,. II ·�··············••9 �--9 ■■ ••··-�·-···�-��9· II MARKS: 150 TIME: 2 HOURS This question paper consists of 12 pages, a formula sheet and a 9-page Answer Book.

Downloaded from hlayiso.com INSTRUCTIONS AND INFORMATION Read the following instructions carefully and follow th em precisely. 1. Answer ALL the questions. 2. A special ANSWER BOOK is provided in which to answer ALL the questions. 3. Show ALL workings to earn part-marks. 4. You may use a non-programmable calculator. 5. You may use a dark pencil or blue/black ink to answer questions. 6. Where applicable, show ALL calculations to ONE decimal point. G0� 7. If you choose to do so, you may use the Financial Indicator Formul , et attached at the end of this question paper. The use of this form� NOT compulsory. l �e� �, 8. Write neatly and legibly. 9. Use the information in the table below as a guide vy,l(e�nswering the question paper. Try NOT to deviate from it. ?>�' QUESTION TOPIC MARKS MINUTES 1 Reconciliations 30 25 2 35 30 3 40 30 4 Cas, 45 35 TOTAL 150 120 Copyright reserved Please tur n over

Downloaded from hlayiso.com : Acgguntéaded from Stanmorephjisics. COipPatatory Examination September 2022 QUESTION 1 (30 Marks; 25 Minutes) RECONCILIATIONS AND AGE ANALYSIS 1.1 BANK RECONCILIATION REQUIRED: 1.1.1 Update the totals of the Cash Receipts Journal and the Cash Payments Journal. Use the table provided in the Answer Book. (7) 1.1.2 Prepare the Bank Reconciliation Statement for 30 June 2022. (5) INFORMATION: A. Extract from the Bank Reconciliation Statement on 31 May 2oza\ c Outstanding deposit : 18 May 2022 ae R19 000 Outstanding deposit : 30 May 2022 C7 R15 000 Outstanding EFTs: No 119 KA) R22 000 No 120 ws R18 750 \ Ve ¢ The outstanding deposit on 30 May 2022 ap safed on the June 2022 bank statement, but the deposit on 18 May appeared as R15 000. An investigation revealed that the bookke never deposited the money. It was decided that the outstanding am e written off. e EFT 119 was on the June bai ‘@tatement with the correct amount, but EFT 120 was on the statement the correct amount of R17 800. B. The provisional totals in the eéeh journals before receiving the bank statement was as follows: % CRU 300 and CPJ: 96 500 C. Information on th bank statement not in the June Cash Journals: e Bank charges, 00 ¢ Debit order ater and electricity, R1 820 e Direct d for monthly rent from the tenant, R5 200. D. Information in the June Cash Journals, not on the June Bank Statement: e 42 for R7 500 paid to Shandu Traders on 30 June 2022. ¢ Outstanding deposit on 30 June 2022, R31 700. E. The Bank statement showed a favourable balance of R43 300 F. Balance according to the bank account on 30 June 2022 is R?. Copyright reserved Please turn over

Downloaded from hlayiso.com AccountngBownloaded from Stanmegephysit’secEin annaion September 2022 1.2 CREDITORS RECONCILIATION Veli Traders buys goods on credit from Mkhuze Suppliers. The information presented is for June 2022. REQUIRED: Reconcile the Creditors Ledger account of Mkhuze Suppliers in the books of Veli Traders with the statement received by completing the table provided in the Answer Book. Insert a + or — next to each amount and calculate the final balance. Commence with the provisional balances as provided in the ANSWER BOOK. INFORMATION: A. Creditors Ledger of Veli Traders Mkhuze Suppliers (CL6) DATE DETAILS FOL | DEBIT CREDIT | BALANCE June | 1 | Balance b/d 102 600 5 | Invoice No. 44 CJ 13 220 115 820 10 | EFT No. 281 CPJ 45 000 70 820 Discount CPJ 2 250 68 570 18 | Debit Note No. 14 | CAJ 2 940 65 630 28 | Invoice No. 66 CJ 21 360 86 990 B. Statement received from Mkhuze Suppliers MKHUZE SUPPLIERS: STATEMENT OF ACCOUNT Customer: Veli Traders Statement date: 25 JUNE 2022 DATE DETAILS DEBIT CREDIT | BALANCE May 28 | Account rendered 116 490 30_| Invoice No. 37 10 110 126 600 June 1_| Receipt No. 114 24 000 102 600 5 | Invoice No. 44 23 220 125 820 10_| Receipt No. 132 45 000 80 820 12 | Invoice No. 55 16 920 97 740 12 | Invoice No. 56 3 000 100 740 18 | Credit Note No. 74 2.940 103 680 22 | Invoice No. 77 11 580 115 260 Includes transactions up to 25'" of each month c. Differences noted: (i) Invoice No. 44 was recorded incorrectly in the creditors ledger. (ii) The statement did not reflect the discount for early payment on the 10", This will be rectified on the next statement. (ii) Veli Traders bookkeeper omitted Invoice No. 55 by mistake. (iv) It was discovered that Invoice No. 56 on the statement is for the goods ordered by the warehouse manager for personal use. The manager is facing disciplinary action. Goods valued at R2 940 were returned on the 18". It is shown as a debit entry in the creditor’s ledger as well as the statement of account. Invoice No. 77 on the statement was an error made by Mkhuze Suppliers. These goods were not purchased by Veli Traders. The statement was received on 25 June 2022. Copyright reserved (11) Please turn over

Downloaded from hlayiso.com . Accpyatiatibaded from Stanmorephgsics. cOfP22°" Examination September 2022 1.3. DEBTORS’ AGE ANALYSIS REQUIRED: 1.3.1 Calculate the percentage of the total debts that have exceeded the credit terms of 30 days. (3) 1.3.2 The owner, Z. Zool is concerned that the control over debtors has not been satisfactory. She wants you as the internal auditor, to: Explain TWO problems highlighted by the Debtors Age Analysis and provide relevant evidence for each (Names or figures). (4) INFORMATION: The credit terms are 31 days. DEBTORS’ AGE ANALYSIS ON 30 JUNE 2022 NAMES Credit limit | Balance | Current | 30 days | 60 days | 90 days + R R R R R R S. Zicaba 10 000 16 140 6 030 1350 920 7 840 N. Thabethe 13 000 9 550 9 550 D. Khumalo 9 500 9 120 5 700 3 420 A. Msomi 12 000 14 190 9 100 2 090 3 000 49 000 30 380 6 860 3.920 7 840 30 Copyright reserved Please turn over

Downloaded from hlayiso.com AccountingBownloaded from Stanmaobephysit sees Peminaton September 2022 QUESTION 2 (35 Marks; 30 Minutes) STOCK VALUATION AND INTERNAL CONTROL 2.1. HI-TECH WORLD TRADERS You are provided with information relating to Hi-Tech World Traders for the year ended 28 February 2022. The periodic inventory system and the weighted average stock valuation methodyare.in=operation. The business buys and sell decoders. They buy all their stock from one supplier. REQUIRED: 2.1.1. Calculate the following on 28 February 2022: « Value of closing stock. (10) e The stock turnover rate for the year. (5) 2.1.2 Calculate the number of units missing. (4) 2.1.3 The owner wants to change the valuation method of decoders to FIFO. e Calculate the value of closing stock using the FIFO method. (5) e What advice would you offer, about his proposal? (2) INFORMATION: = A. _Opening and closing stock 4 41 March 2021 100 units R82 280 28 February 2022 130 units 2 B. Purchases during the year (excluding carriage) are as follows: Date Units Cost per unit Total cost 15 May 2021 250 R900 R225 000 21 October 2021 800 R970 R776 000 12 January 2022 100 R1 400 R140 000 1 150 R1 144 000 C. Carriage on purchases during the year was charged at R40 per decoder by the supplier. D. Returned 10 defective decoders purchased during January 2022, to the supplier. The supplier granted a full refund including carriage. E. A selling price of R1 771 was maintained throughout the year. Sales amounted to R1 962 268. Copyright reserved Please turn over

Downloaded from hlayiso.com . Accpyptinafibaded from Stanmorephisics. cOitr2*¥ Examination September 2022 2.2 PROBLEM SOLVING (MANAGING DELIVERY) You are the internal auditor of Mevamhlophe Traders. Philani, the owner is concerned that he is spending too much on delivering goods to customers. He has provided you with figures for June 2022. REQUIRED: Identify ONE different problem regarding each vehicle/driver. Quote figures. Give Philani ONE point of advice for EACH problem identified. (9) INFORMATION: A. Philani has three delivery vehicles and employs three drivers to transport goods to his customers free of charge within 20km of the business (40km round trip). The drivers are expected to work five days per week. There are four weeks in June. B. Information from the accounting records for June 2022. Vehicle 1 Vehicle 2 | Vehicle 3 Name of driver Cebile Nozipho Phumzile Date of purchase 1 July 2021 | 1 June 2018] 1 April 2010 Carrying value R270 000 | R102 000 R1 Salary of driver per month R8 000 R5 000 R5 000 Number of deliveries made 48 80 120 Kilometers travelled 1 296 4640 3 500 Average number of kilometers 27 58 29 per trip Petrol costs (R21,31 per litre) R1 257.29 | R4 453.79 | R5 327.50 35 Copyright reserved Please turn over

Downloaded from hlayiso.com AccountinaBownloaded from Stanmafephysi€sreo Examination September 2022 QUESTION 3 COST ACCOUNTING (40 marks, 30 minutes) 3.1. CONCEPTS Choose an example in COLUMN B to match the concept in COLUMN A. Write only the letter (A — D) next to the number (3.1.1 — 3.1.3) in the ANSWER BOOK. The business produces school desks. COLUMN A COLUMN B 3.1.1 | Direct material | A | Polish purchased to use on the completed school desks. 3.1.2 | Indirect material |B | Salary of factory carpenter. 3.1.3. | Indirect labour C_ | Wood purchased to produce school desks. D_ | Salary of the factory foreman. 3x1 (3) 3.2. BUHLEBENDALO BAGS Buhlebendalo Bags manufactures handbags. They sell their bags at a mark-up of 100% on cost. The information given was taken from their financial records on 31 July 2022, the end of the financial year. REQUIRED: 3.2.1 Complete the Factory overhead cost note for the year ended 31 July 2022. (13) 3.2.2 Prepare the Production Cost Statement for the year ended 31 July 2022 (show calculations in brackets where no notes/calculations are required) (13) INFORMATION: A __ The following balances were appeared in the books: 31 July 2022 1 August 2021 Raw material 224 600 R275 900 Work in progress ? R310 200 Finished products R490 000 R320 000 Indirect materials R64 000 R25 000 B. Direct material « Raw materials purchased, R1 650 000. e Raw material issued to production process (department) amounted to R1 842 300 Copyright reserved Please turn over

Downloaded from hlayiso.com Accoupsinloaded from Stanmoregipysics Feenpoy Examination September 2022 C Direct labour « The monthly basic wages of the factory workers is R80 000. During November, they earned an additional R25 000 in overtime. e In December, all workers received a bonus equal to one month’s basic wages. e The employer's contribution to the UIF amounts to 1% of the basic wage bill. D. The following adjustments relate to Factory overhead cost: e Indirect materials: The bookkeeper incorrectly recorded the indirect material issued to the factory as 90%, which amounted to R160 200 instead of 80%. e Indirect labour: There were two factory foremen at the start of the accounting period. Factory foremen have been paid a salary of R360 000 in the first half of the accounting period. Due to a reduction in production level (demand) the manager decided to reduce the monthly salaries of both factory foremen by 5% as from 1 May 2022. On 1 July 2022, one foreman resigned from work. Foremen earned the same monthly salary. e Factory rent: The rent expense reflected in the trial balance on 31 July 2022 was R124 200. The rent increase annually by 10% p.a. on 1 January. The rent for August 2022 has already been paid. e Water and electricity The account for the financial year was R120 000, this includes water and electricity for the manager's house (personal use) of R12000. The business account must be divided between the factory, office and sales department in the ratio 4:1:1. , e Maintenance on factory equipment Maintenance on factory equipment amounts to R250 per hour. A total of 480 maintenance hours were recorded. e Depreciation on factory equipment amounted to R206 000. EA total of 4 438 handbags were manufactured during the financial year and sold at R1 800 per bag. Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting Downloaded from StanmovrephyshrepaetsmExamination September 2022 NSC 3.3. SINETHEZEKILE WATER BOTTLE MANUFACTURERS Sinethezekile Water Bottle Manufacturers produces and sells water bottles. The business is owned by Anele Mchunu. REQUIRED: 3.3.1. Calculate the break-even point for year ended 31 July 2022. (4) 3.3.2 Explain whether the business should be satisfied with the level of production achieved. Quote figures. (3) 3.3.3 Except for a general increase in wages, give TWO other reasons for the increase in direct labour costs per unit. In each case, provide a practical solution to address this. (4) INFORMATION: The following information was taken from the books: 31 JULY 2022 | 31 JULY 2021 Direct material/cost per unit R10 R13 Direct labour cost per unit R12 RQ Variable cost per unit R25 ; Total fixed costs ; R 210 000 Sales for the year (All units produced were R 480 000 sold) Number of bottles produced and sold 12 000 units 12 500 units 40 Copyright reserved Please turn over

Downloaded from hlayiso.com Acconsting Faoaded from Stanmoreptifsics. COfpparatory Examination September 2022 QUESTION 4 CASH BUDGETS (45 marks, 35 minutes) You are provided with an incomplete Cash Budget of Nongoma Traders. The business is owned by Madoda Zulu. REQUIRED: 4.1 Complete the Debtors’ Collection Schedule for November 2022. (7) 4.2 Calculate the amount of bad debts that will be written off in November 2022. (3) 4.3 Calculate the missing figures indicated by (i) - (iv) on the Cash Budget. (11) 4.4 The rent will increase on 1 November 2022. Calculate the percentage increase. (4) 4.5 Interest on loan is paid on the last day of each month and is not capitalised. (4) Calculate the loan balance on 1 October 2022. 4.6 Comment on the Fixed Deposit budgeted for November 2022 and provide a (3) possible application (use) of these funds. Quote figures. 4.7 Madoda decided that the business will purchase a delivery vehicle on 1 October 2022. State TWO benefits of the decision. (4) 4.8 Madoda extracted the following actual and budgeted figures for September 2022: BUDGETED ACTUAL Total sales 792 000 633 600 Advertising 63 360 63 360 Delivery expenses 55 440 48 000 Telephone 6 100 8 540 Comment with figures and provide a possible reason in each case for the following: e Effectiveness of the advertising * Control over delivery expenses and telephone (9) INFORMATION: A. Actual and budgeted sales and cost of sales: MONTH TOTAL SALES COST OF SALES August 2022 924 000 616 000 September 2022 792 000 528 000 October 2022 744 000 496 000 November 2022 876 000 584 000 NOTE: 60% of the total sales are for cash. B. The Debtors’ Collection Schedule for October and November 2022 MONTH CREDIT SALES | OCTOBER NOVEMBER August 2022 369 600 66 528 September 2022 316 800 221 760 ? October 2022 297 600 29 760 ? | November 2022 350 400 ? 318 048 ? Copyright reserved Please turn over

Downloaded from hlayiso.com Accountinphexvnioaded from Stanmoréphysics:eenry Examination September 2022 iS C. Debtors currently pay according to the following trend: ¢ 10% paid in the month of sale * 70% paid in the first month following the month of sale e 18% paid in the second month following the month of sale e The balance is written off in the third month following the month of sale. D. The business maintains a fixed stock level. Goods sold in a month are teplaced in the same month. E. 60% of the total purchases are on credit. Creditors are paid in the month following the month of purchase to take advantage of a 5% discount. F. Extract of the Cash Budget for the two months ending 30 November 2022: OCTOBER | NOVEMBER RECEIPTS | Cash sales ; (i) 525 600 Collection from debtors 318 048 ? Rent income 11 000 12 320 Fixed deposit (including interest) _ 88 000 Total Receipts ? ? PAYMENTS Cash purchases of trading stock 198 400 (ii) Payments to creditors (for stock) (iii) 282 720 | Telephone ; 6 820 8 400 Advertising 2 59 520 70 080 | Loan instalment 40 000 Interest on loan (15% p.a) 3 750 3 250 Deposit on delivery vehicle 78 000 Drawings ? ? Instalment on delivery vehicle (12 equal instalments) 26 400 Other operating expenses 68 150 102 524 Delivery expenses 52 080 61 390 Total Payments ? ? CASH SURPLUS/ DEFICIT (49 600) 77 200 BANK BALANCE AT BEGINNING OF MONTH 22 400 ? BANK BALANCE AT END OF MONTH (27 200) (iv) 45 TOTAL MARKS: 150 Copyright reserved Please turn over

Downloaded from hlayiso.com : _ Accoultyea/oaded from Stanmorepfiysics. Comey Examination September 2022 . Ss GRADE 12 ACCOUNTING FINANCIAL INDICATOR FORMULA SHEET — Gross profit X 100 Gross profit X 100 Sales 1 Cost of sales 4 Net profit before tax X 100 Net profit after tax X 100 Sales 4 Sales 4 Operating expenses X 100 Operating profit X 100 Sales 1 Sales 1 Total assets : Total liabilities Current assets : Current liabilities (Current assets — Inventories) : Current liabilities | Non-current liabilities : Shareholders’ equity (Trade and other receivables + Cash and cash equivalents) : Current liabilities Cost of sales Average trading stock X 365 Cost of sales 1 Average trading stock Average debtors X 365 Average creditors X 365 Credit sales 1 Cost of sales 1 Net income after tax X 100 Net p rofit after tax X 100 ; . Number of issued shares 1 Average shareholders’ equity 1 (*See note below) x 100 Net income after tax + Interest on loans Average Shareholders’ equity + Average non-current liabilities 4 Dividends for the year_ X 100 Shareholders’ equity. X 100 Number of issued shares 4 Number of issued shares 4 Interim dividends X 100 Final dividends X 100 Number of issued shares 1 Number of issued shares 4 Dividends per share X 100 Dividends for the year_ X 100 Earnings per share 1 Net income after tax 4 Total fixed costs Selling price per unit — Variable costs per unit NOTE e In this case, if there is a change in the number of issued shares during a financial year, the weighted-average number of shares is used in practice. Copyright reserved