# Accounting Grade 12 Paper 2 KZN Prelim 2023 Memo > Grade 12 Accounting Paper 2 memorandum from the KZN Prelim 2023, 9 pages. Read online or get the free PDF download, question paper linked when available. - Page: https://www.hlayiso.com/library/2023-kzn-prelim-p2-memo/aedee74c-5a8a-4ba9-9755-cc128e2ffaa4 - Updated: 2026-09-27 - Subject: Accounting - Grade: Grade 12 - Document type: Memorandum - Year: 2023 - Exam period: KZN Prelim - Paper: 2 - Curriculum: CAPS - Pages: 9 Breadcrumbs: [Home](https://www.hlayiso.com/) › [Library](https://www.hlayiso.com/library) › [Grade 12](https://www.hlayiso.com/library/grade-12) › [Accounting](https://www.hlayiso.com/library/grade-12/accounting) › [Accounting Grade 12 Paper 2 KZN Prelim 2023 Memo](https://www.hlayiso.com/library/2023-kzn-prelim-p2-memo/aedee74c-5a8a-4ba9-9755-cc128e2ffaa4) ## About this document Accounting · Grade 12 · KZN Prelim · 2023. Memorandum, 9 pages. Read online or download the PDF. Read it free online on the page above; download the PDF from there. ## Document text Text extracted from the PDF. Layout, diagrams and tables may not survive extraction. ### Page 1 Downloaded from hlayiso.com Downloaded from StahitéHephpsi292éom KWAZULU-NATAL PROVINCE EDUCATION REPUBLIC OF SOUTH AFRICA NATIONAL SENIOR CERTIFICATE GRADE 12 o ACCOUNTING P2 *s " MARKING GUIDELINES : " PREPARATORY EXAMINATION : « SEPTEMBER 2023 : MARKS: 150 MARKING PRINCIPLES: 1. Unless otherwise stated in the marking guidelines, penalties for foreign items are applied only if the candidate is not losing marks elsewhere in the question for that item (no penalty for misplaced item). 2. Penalties for placement or poor presentation (e.g. details) are applied only if the candidate is earning marks on the figures for that item Unless otherwise stated, give full marks for correct answer. If answer incorrect, mark the workings. If a pre-adjustment figure is shown as the final figure, award part-mark as a working mark for that figure (not the method mark for the answer). Note: if figures are stipulated in memo for components of workings, these do not carry the method for final answer as well. 5. Unless otherwise indicated, the positive or negative effect of any figure must be considered to award the mark. If no + or — sign or bracket is provided, assume that the figure is positive. 6. Where indicated, part-marks may be awarded to differentiate between differing qualities of answers from candidates. 7. If candidates provide more than the required number of responses, inspect all responses to give benefit to the candidate. Penaltics may be applicd for forcign cntrics if candidates carn full marks on a question (max -2 per Q). 8. This memorandum is not for public distribution, as certain items might imply incorrect treatment. The adjustments made are due to nuances in a certain question. 9. Where penalties are applied, the marks for that section of the question cannot bé-a-final negative. 10. Where method marks are awarded for operation, the marker must inspect the reasonableness of the answer. 11. Operation’ means ‘Check operation’. ‘One part correct’ means ‘Operation & one-part correct’. Note: check operation must be +,-,x,+, or per candidate’s calculation (if valid) or per memo 12. Incalculations, do not award marks for workings if numerator & denominator are-swapped — this also applies to ratios. 13. In awarding method marks, ensure that candidates do not get full marks for any item that is incorrect, indicate with a Bd. 14. Be aware of candidates who provide valid alternatives beyond the marking guideline. Note that one comment could contain different aspects. 15. Codes: f=foreign item; p=placement. Pe Copyright Reserved Please Turn Over ### Page 2 Downloaded from hlayiso.com ; £ s fet Accounts wnloaded from Stanmeoraphy: ‘om eptember 2023 Preparatory Examination This marking guideline consists of 9 pages. QUESTION 1 1.1 | Choose an example from COLUMN B that matches a cost category in COLUMN A. Write onlythe letter (A-D) next to the question numbers 1.1.1 to 1.1.3) in the ANSWER BOOK, e.g 1.1.4 E. 1.1.1 BY 1.1.2 Dv 1.1.3 | Av 3 1.2.1] PRODUCTION COST STATEMENT FOR THE YEAR ENDED 30 JUNE 2023 Direct material cost Missingfgue | 1906000 4 Direct labour cost (1 500 000 x 60/100) 900000 ¥ Prime cost Operation 2806000 M Factory overhead cost (700 000Y — 96 000v + 50 000”) 654000 M (-160 000 + 64 000) Total cost of production Operation] 3460000 M Work in process — beginning of the year 250 000 3710 000 Work in process — end of the year (110000) ¥ Total cost of production of finished products (200 x 18 000) 3 600 000 40 1.2.2] ABRIDGED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2023 Sales (16 900 v x 270) 4563 000* OR [(5 000 + 18 000 —6 100) Twomarks x 270] Operation one part correct Cost of sales (900 000Y + 2 380 000M) (3 280 000)* M1 ‘One mark See 1.2.1 One mark OR 900 000 + (3 600 000 — 1 220 000) Operation one part correct Gross Profit Operation 1283000 Administration (380000) ¥ Selling and distribution (470000) ¥ Net profit for the year Operation one part correct 433000 M iM *Operation one part correct Copyright Reserved Please Turn Over ### Page 3 Downloaded from hlayiso.com Accounts wnloaded from Stanmeoraphy: ° ‘om ScPember 2023 Preparatory Examination 1.3.1 | Explain why it is important to calculate the expected break-even point for a business at the beginning of a financial year. Ee Foresee_any potential problems of low production. No profitsfare made until breakeven is reached. Determinecthe minimum number of units to be produced to prevent loses. To produce, enough products to set the production level that will cover all costs. To identify whether productivity levels should be improved to ensure acceptable eal levels. e To produce enough products / Prevent low profits/prevent a loss / Improve efficiency / To compile a budget. 1.3.2 | Mandy feels that she can improve the sales of calculators. Provide TWO suggestions on how this can be achieved. vv Vv e Decrease the mark-up % (or selling price) e Set targets for completion during normal time and try to reduce overtime pay. e Spend more money on advertising and sales promotion and explore new target markets e Allow customers to buy direct and offer discount 1.3.3 | Mandy was concerned about the increase in the fixed cost per unit of calculators. What would you say to her? Provide ONE point and quote figures to support your answer. Taki Ginter aahaueiononiea aus vv e Production decreased by 800 units (40%) e Fixed costs are not influenced by the level of production (R210 000) e Fixed cost per unit will be much higher (from 120 to 175). 1.3.4 | Except for a general increase in wages due to inflation, give TWO other reasons for the increase in direct labour costs per unit. In each case, provide a practical solution to address this. POSSIBLE REASON vv SOLUTION Vv Working slower/ De-motivated / Lazy | Monitor normal working hours /Ensure workers workers / Lack of management. complete set targets during normal time. Overtime abused to get higher pay. Monitor workers to ensure that they work efficiently during normal hours. / Claim overtime when necessary. Load shedding Energy backup system e.g. generators, solar panels Lack of skills Retraining / reskilling 1.3.5 | Mandy wants to increase production by 700 units during the next=financial year while maintaining costs. Calculate the additional profit that she will achieve: WORKINGS ANSWER 700Y x 203V¥ 142 100M (540 - 337) TOTAL MARKS 40 Copyright Reserved Please Turn Over ### Page 4 Downloaded from hlayiso.com Accounts wnloaded from Stanmoraphy: ° ome me es Preparatory Examination QUESTION 2 2.1.1 | Calculate the selling price per unit for running shoes. WORKINGS ANSWER R1 200“ ~ 1 758 0001465 SSEREN 2.1.2 | Calculate the value of closing stock on 30 April 2023 using weighted average method. WORKINGS ANSWER 75 400v_+ 1107 000 V+ 17 000V — 15 000” 200 ¥ + 1 700V —20¥ R 270 900 MI um _— Operation (must be x 430) = R630 x 430 2.1.3 | It was discovered that a number of running shoes were shoplifted. Calculate the number of the missing shoes. WORKINGS ANSWER (200 + 1 700-20) 1-430 V— 1465” Warkamounswihsgns | 12 “units missin 1 880 Accept — 15 units/ +15 units / 0 units / No shoes missing 2.1.4 | Provide TWO strategies that Ganesha should implement to prevent the loss of stock in future. TAnyiwowvalid part 77 e Improve stock control methods (regular stock take). e Division of duties: person ordering is not same person to ofe-receiving goods to one packing to one recording transactions in the accounting-records e Proper safeguarding of stock while in storage ¢ Security guards at exit points and limited access to the storeroom Copyright Reserved Please Turn Over ### Page 5 Downloaded from hlayiso.com Swnloaded from Stanmeoraphy: ° ome me es Preparatory Examination Account) 2.2.1 | Calculate the stock turnover rate of soccer boots for 2023. (Use the average stock). WORKINGS ANSWER es oe 2 times M1 Ya¥ (105-000 VY + 63 380”) eEECRE 847190 (three marks) 2.2.2 | Explain whether Ganesha should be concerned about stock turnover rate. It was 5 times in 2022. It is a concern because Stock turnover rate decreased from (5 times) to 2 times by 3 (150%). vv The stock is not sold very fast compared to last year. ~ 2.2.3 | Ganesha is not satisfied with the performance of soccer boots. Identify TWO problems by quoting figures and trends. Provide a solution to each problem. PROBLEM SOLUTION/ADVICE v Vv Problem identified “ - figures with trendsv_ ¥ Problem 1: e Investigate the reason for the low Days worked (172/264) 65% of work number of days worked. time CeLnes from cue * Monitor opening and closing times and the employees’ leave-taking. e Do cost-benefit analysis to determine whether to keep this department. e Pay workers only for days worked. Problem 2: e Use an ordering system and buy e Stock turnover rate (2 times) according to orders. e Lower sales by 37% (820-515) |¢ Sacrifice profit (lower mark-up) to ¢ Stock piling increased from increase sales. 94 to 296 units. e Offer special prices / sale of boots for a + Toomany returns 45/ Increase || bre check TOTAL MARKS 30 Copyright Reserved Please Turn Over ### Page 6 Downloaded from hlayiso.com Accounts wnloaded from Stanmeoraphy: 2 ome me es Preparatory Examination QUESTION 3 3.1.1 | Debtors’ Collection Schedule for the two months ending 31 October 2023 Month Credit Sales September October | Bad debts July 204 000V v 51 000” 10 200 August 222 000 88 800 55 500V 11 100 September: 198 000V 4 56 430 79 200MM October. 210 000 59 850V v 10 *“A62 000 x 30/70 = 198 000 Or (56 430 x 100/95) x 100/30 = 198 000 188 100 3.1.2 | Calculate the figures indicated by (i)-(v) on the Cash Budget. WORKINGS ANSWER (i) 0, on 000 x 70/30 or 700 000 x 70% 490 000v” 700 000 — 210 000 (ii) | 528 000 v v (660 000 x 100/125) v x 0,6 316 800M ul ay 528 000 (660 000 x 100/125) x 0,4” x 0,97” 204 864 vw One mark One part correct OR 528 000 - 316 800 see (ii) x 97% (iv) 540 000 x 12/100 x 1/12 5 400v'v" “) 4 1 8 600/1.08 45 000V V OR 48 600 x 100/108 13 3.1.3 | Calculate the Average Debtors' Collection period in days. WORKINGS ANSWER 20,2)0R°20 days 116 500 — Two marke ‘aa lt parterrcs, Ye ¥ (104 600” +128 400 “) x 365 2100000 v 1 5 Copyright Reserved Please Turn Over ### Page 7 Accounts wnloaded from Stanmoraphysiescom Downloaded from hlayiso.com 3.1.4 The owner wants to purchase the business premises rather than renting. Provide ONE advantage and ONE disadvantage of this option. Any ONE a dvantage Vv Any ONE disadvantage Vv le Saving on over time, le Earn capital gains through property,valuations that increase rent Payment of rates and taxes; Repairs and/or maintenance costs; Insurance costs; Interest payments on the mortgage bond 3.1.5 Comment and provide one point of advice on each expense item. Quote | figures and trends. 3 500 / by 27% Expense Comment vv Vv Advice Vv v item Water and | Underbudgeted/Overspent by | Check for leaks (faulty cables) / Electricity | 6 800/ by 19% Avoid wastage Advertising | Overbudgeted/Underspent by | Use budgeted amount to increase the sales 3.2 Identify ONE problem at each branch. Quote figures to support the problem identified and give Msizi advice on how to solve the problem in returned (15). Six days worked but few jackets (170) sold. Lowest advertising spending R500 which results to lowest sales 170 units each case. PROBLEM AND FIGURE | SOLUTION Vv vv ‘44 v v v Branch 1 20 Jackets were stolen. |e Introduce security measures. Phumzile Stock holding period too |e Division of duties amongst staff. long — 120 days. e Improve marketing strategy. Branch2 |e Cash deposited e Division of duties (establishing Peggy R308 400 instead of segregation of duties). R368 400. Cash stolen Make daily bank deposit. (R60 000). Improve internal control over e Number of days worked cash. per week (Five - Monday to Friday) Branch 3 ¢ Too many jackets e Change to a supplier who will Parvati provide quality jackets. Supply correct items to clients. Change to another marketing provider. Improve advertising strategy. Copyright Reserved TOTAL MARKS 45 Please Turn Over September 2023 Preparatory Examination ### Page 8 Downloaded from hlayiso.com ‘eouownloaded from Stanmoraphysicscom September 2023 Preparatory Examination QUESTION 4 4.1.1 | CASH RECEIPTS JOURNAL CASH PAYMENT JOURNAL R R 510 600 487 300 6250 ¥ 3600 ¥ 290 ¥ 1850 ¥ 1000 ¥ 425 ¥ 517140 Both Totals R494 175 4.1.2 [BANK RECONCILIATION STATEMENT ON 31 JULY 2023 ON Gee DEBIT CREDIT Balance per Bank Statement R43 310 R43 310 Vv Credit outstanding deposit R10 000 R10000 v Debit outstanding EFT: EFT No.655 (R7 095) R7 095 ¥ Debit incorrect amount (RQ 800) R9 800 ¥ Credit incorrect amount R1 850 R1850 ¥ Balance as per Bank Account | (R38 265)| *R38265 MM | _ Balancing figure serene R55 100 R55 160 4.1.3 | Explain whether or not the business made the right decision in alerting the bank Any ONE valid explanation vv about the deposit of R9 800, on 25 July 2023. e Good decision made to alert the bank because there was no proof of payment as future reference/No documents e Every transaction must be supported with documentation to avoid problems which can involve stakeholders such as SARS, Banks, creditors, ete: e The intended recipient would have complained about not receiving the money, which would have led to a disagreement or the possibility Ofajpolice investigation. e The business must maintain its reputation as an ethical organisation. Copyright Reserved Please Turn Over ### Page 9 Downloaded from hlayiso.com Accounts wnloaded from Stanmeoraphy: ° ‘om ScPember 2023 Preparatory Examination 4.2. CREDITORS RECONCILIATION 4.2.1 | Briefly explain how the preparation of a creditors’ reconciliation as an internal control measure can assist the business in managing their creditors effectively. Provide TWO points. Any TWO refpyafcontol measures VV ¥¥ e Errors-and omissions can be detected and corrected. e Fraud can be detected and minimised. e The correct payment can be made to creditors. 4.2.2 | Use the table provided to indicate the changes that must be made in the Creditors’ Control account and Creditors’ List in the books of Titanic Traders to take into account the errors and omissions noted. Indicate the increase or decrease with a (+) or (-) with each amount. Show brackets as alternative method. Creditors’ Control Creditors’ List R R Provisional balance/total 74 720 32 600 A +900 Vv B +3720 Vv +3720 Vv c -450 vv D -32800 vv E +8870 Vv Both totals 45640 Mw 45 640 4.2.3 | State THREE internal control measures that the business can use to prevent similar incidents from happening in future. Any THREE separate releventontolmeasures VV 0 Vv VV e Division of duties — Philani must not be the only person responsible for ordering and recording goods. e« Rotate duties so that employees do not have permanent control over an aspect of the business. e Have special order forms to be signed by two people. Check documents regularly against deliveries. Do regular/random stock counts to verify stock records. 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