# Accounting Grade 12 Paper 2 MP Prelim 2023 Question Paper > Grade 12 Accounting Paper 2 question paper from the MP Prelim 2023, 12 pages. Read online or get the free PDF download, memo linked when available. - Page: https://www.hlayiso.com/library/2023-mp-prelim-p2-qp/c117fe99-46fa-4aab-96d7-913b77a199d9 - Updated: 2026-09-27 - Subject: Accounting - Grade: Grade 12 - Document type: Question paper - Year: 2023 - Exam period: MP Prelim - Paper: 2 - Curriculum: CAPS - Pages: 12 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 MP Prelim 2023 Question Paper](https://www.hlayiso.com/library/2023-mp-prelim-p2-qp/c117fe99-46fa-4aab-96d7-913b77a199d9) ## About this document Accounting · Grade 12 · MP Prelim · 2023. Question paper, 12 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 NATIONAL SENIOR CERTIFICE GRADE 12 ACCOUNTING P2 SEPTEMBER 2023 MARKS: 150 TIME: 2 HOURS This question paper consists of 11 pages. A formula sheet and an 9- page answer book. Copyright reserved Please turn over ### Page 2 Downloaded from hlayiso.com Accounting/P2 2 MDE/September 2023 NSC KEEP THIS PAGE BLANK Copyright reserved Please turn over ### Page 3 Downloaded from hlayiso.com Accounting/P2 3 MDE/September 2023 NSC INSTRUCTIONS AND INFORMATION Read the following instructions carefully and follow them precisely. 1. Answer ALL questions. 2. A special ANSWER BOOK is provided in which to answer ALL questions. 3. A Financial Indicator Formula Sheet is attached at the end of this question paper. 4. Show ALL workings to earn part-marks. 5. You may use a non-programmable calculator. 6. You may use a dark pencil or blue/black ink to answer questions. 7. Where applicable, show ALL calculations to ONE decimal point. 8. Write neatly and legibly. 9. Use the information in the table below as a guide when answering the question paper. Try NOT to deviate from it. QUESTION TOPIC MARKS MINUTES 1 Cost Accounting 35 28 2 Inventory Valuation 35 28 3 Reconciliations: Bank and Creditors 40 32 4 Budgeting 40 32 TOTAL 150 120 Copyright reserved Please turn over ### Page 4 Downloaded from hlayiso.com Accounting/P2 4 MDE/September 2023 NSC QUESTION 1: MANUFACTURING (35 marks; 28 minutes) 1.1 PROTEA MANUFACTURERS Protea Manufacturers is a small manufacturing business that produces one tipe of fabric baskets. The business uses the weighted-average method to value their raw material stock. Their financial year ended on 30 June 2023. REQUIRED: 1.1.1 Calculate the Direct labour cost on 30 June 2023 (5) 1.1.2 Prepare the Production Cost Statement for the year ended 30 June 2023. (13) 1.1.3 Identify ONE problem relating to the supervision of workers. Quote figures. (2) Suggest ONE strategy the business can use to improve the supervision of workers. (2) INFORMATION: A. Stock balance: 30 June 2023 1 July 2022 Work-in-progress stock ? 22 450 B. Raw material stock A total of 45 000 metres of fabric was issued from the storeroom for production. The weighted-average cost per metre is R11,65. C. Direct labour The business employs FIVE factory workers, with the following conditions:  They must work 8 hours normal time per day for 5 days a week,  48 weeks a year, and  they must produce two fabric baskets an hour during normal and overtime. Details relating to total number of hours worked by workers and remuneration rates for the financial year ended 30 June 2023: Hours per Rate per Number of Total worker hour workers Normal time 1 400 R40 5 R? Overtime 960 R384 000 2 360 R? NOTE: The employer’s contribution amounts to 11,5% of normal time wage. D. Factory overhead cost: The bookkeeper calculated the factory overhead cost as R134 900. However, he made the following error, which must still be adjusted:  He included the full amount of R33 600 for water and electricity expense. Only 75% of this expense must be allocated to the factory. The balance is an administration cost. E. The business produced 20 500 fabric baskets during the financial year, at a unit cost of R65. Copyright reserved Please turn over ### Page 5 Downloaded from hlayiso.com Accounting/P2 5 MDE/September 2023 NSC 1.2 QUENCHER BOTTLE MANUFACTURERS Quencher Bottle Manufacturers produces and sell bottles. The business is owned by Ronny Shai. The financial year ended on 31 July 2023. REQUIRED: 1.2.1 Provide a calculation to confirm that the break-even point of 2 520 units for 2023 is correct. (4) 1.2.2 Comment on the level of production achieved and the break-even point on 31 July 2023. Quote figures. (3) 1.2.3 Provide TWO possible reasons for the change in direct material cost per unit. (4) 1.2.4 The owner, Ronny, does not understand why the fixed costs per unit decreased although production has increased. Prove ONE explanation. (2) INFORMATION: The following information was taken from the books on 31 July: 2023 2022 Information Per unit Per unit Fixed Costs R21 R23 Factory overhead cost R15 R17 Administration cost R6 R6 Variable Costs R75 R65 Direct material cost R40 R32 Direct labour cost R25 R24 Selling and distribution costs R10 R9 Selling price R100 R100 Break-even point 2 520 units 1 643 units Number of units produced and sold 3 000 units 2 500 units 35 Copyright reserved Please turn over ### Page 6 Downloaded from hlayiso.com Accounting/P2 6 MDE/September 2023 NSC QUESTION 2: INVENTORY VALUATION (35 marks; 28 minutes) 2.1 Choose a word/term from the list provided for each of the descriptions below. Write only the word/term next to the question number (2.1.1–2.1.3) in the ANSWERBOOK. periodic inventory; perpertual inventory; first-in-first-out; weighted average; specific identification method 2.1.1 This valuation method is suitable for low cost stock items that are purchased on a more regular basis. 2.1.2 This valuation method is suitable for very expensive, individually identifiable stock items. 2.1.3 This stock system records the cost of goods sold at the point of sales. (3 x 1) (3) 2.2 RELAY BICYCLE SHOP Relay Biycle Shop is owned by Dumi Khoza. The business sells bicycles. The financial year ended on 30 June 2023. They use first-in-first-out and the periodic stock system to value their stock. REQUIRED: 2.2.1 Calculate the value of the stock on hand on 30 June 2023 using the first in first out method (FIFO). (5) 2.2.2 Calculate the stockholding period (in days) on 30 June 2023. Use the closing stock figure. (6) 2.2.3 Comment on the stockholding period. Provide ONE point with figures. Note that the stockholding period for 2022 was 120 days. (2) 2.2.4 Dumi is concerned about the control over the stock of biycles.  Calculate the number of bicycles missing. (5)  Provide ONE internal control measure he can use to solve this problem, besides instaling cameras. (2) INFORMATION: A. Stock records of bicycles: Number of units Price per unit Total value Opening stock (1 July 2022) 80 ? R320 000 Closing stock (30 June 2023) 198 ? ? Copyright reserved Please turn over ### Page 7 Downloaded from hlayiso.com Accounting/P2 7 MDE/September 2023 NSC B. Purchases: Units Price per unit Total purchases Purchases 640 R 2 682 500 August 2022 245 R 3 700 R906 500 January 2023 205 R 4 400 R902 000 May 2023 190 R 4 600 R874 000 C. Returns: Five (5) bicycles were returned from the May 2023 purchases. D. Sales: Total sales amounted to R3 289 500 (510 bicycles sold at R6 450 each). 2.3 MANAGEMENT OF INVENTORIES: BUHLE SHOE BOUTIQUE Buhle Brown owns a small shoe boutique which sell tekkies, sandals and shoes. Their financial year ends on 28 February each year. Buhle took the following decisions at the beginning of the 2023 financial year:  She changed to the new supplier of sandals,  She reduced the selling price of shoes in reponse to a new competitor who sells similar shoes at R990. REQUIRED: 2.3.1 Tekkies: Provide TWO points which shows that Buhle and her customers are happy with the quality of Tekkies. Quote figures. (4) 2.3.2 Sandals: Explain why it was a good idea to change to a cheaper supplier of Sandals. State TWO points. Quote figures (4) 2.3.3 Shoes: Identify TWO different problems that Buhle continued to experience in 2023 even though she reduced the selling price of shoes as a strategy in response to a new competitor. Quote figures. (4) INFORMATION: Tekkies Sandals Shoes 2023 2022 2023 2022 2023 2022 Units on hand: 1 March 2022 15 47 30 98 9 12 Units purchased during the year 225 180 102 76 118 120 Returns to supplier 0 0 2 28 2 2 Units sold 230 210 114 130 100 123 Units on hand:28 February 2023 10 15 18 30 25 9 Stockholding period 16 days 26 days 58 days 84 days 91 days 28 days Cost price per unit R1 000 R700 R50 R80 R650 R620 Value of closing stock R10 000 R10 500 R900 R2 400 R16 250 R5 580 Selling price per unit R1 650 R1 085 R75 R120 R910 R1 054 Gross profit R149 500 R80 850 R2 850 R5 200 R26 000 R53 382 Mark-up % 65% 55% 50% 50% 40% 70% 35 Copyright reserved Please turn over ### Page 8 Downloaded from hlayiso.com Accounting/P2 8 MDE/September 2023 NSC QUESTION 3: RECONCILIATIONS: BANK AND CREDITORS (40 marks; 32 minutes) 3.1 BANK RECONCILIATION The information relates to Rainbow Suppliers. The business is owned by Thami Louw. They update their records after receiving the Bank Statement on the 25th of each month. EFTs are renumbered according to date order before recording in journals. REQUIRED: 3.1.1 Show the entries that must be recorded in the Cash Journals by completing the table provided in the ANSWER BOOK. (9) 3.1.2 Calculate the correct bank balance in the ledger on 31 July 2023. (4) 3.1.3 Prepare the Bank Reconciliation Statement on 31 July 2023. (8) 3.1.4 Explain TWO concerns the owner should mention to the bookkeeper relating to the internal control over cash resources. Quote figures. In each case, explain a strategy to prevent such problems in future. (6) INFORMATION: A. Bank Reconciliation Statement on 30 June 2023: Favourable balance as per Bank Statement R18 450 Dated 10 June 2023 12 600 Outstanding deposits: Dated 25 June 2023 15 000 No. 613 13 400 Outstanding EFT’s: No. 614 (dated 29 July 2023) 6 950 Favourable balance as per Bank Account in the Ledger 25 700 NOTE: On comparing the July 2023 Bank Statement, received from RSA Bank, with the Bank Reconciliation Statement of June 2023, the following were noted:  The outstanding deposit of R15 000 did not appear on the July Bank Statement. An investigation revealed that this money was never deposited. The cashier cannot account for the cash.  EFT no. 613 was correctly reflected as R14 300 on the July Bank Statement.  The other outstanding amounts from the previous month appeared on the July Bank Statement. B. The provisional totals in the Cash Journals, before receiving the July 2023 Bank Statement reflected: Cash Receipts Journal Cash Payments Journal R510 600 R484 450 Copyright reserved Please turn over ### Page 9 Downloaded from hlayiso.com Accounting/P2 9 MDE/September 2023 NSC C. The following items on the July 2023 Bank Statement must still be recorded: (i) Transaction fees, R1 425 (ii) Interest on favourable bank balance, R145. (iii) A direct deposit of R6 250 from a tenant. (iv) A debit order of R1 850 for the monthly insurance appeared twice on the Bank Statement. The bank will rectify the problem next month. (v) A debit card payment of R2 700 for a battery for the business vehicle. Thami, the owner, neglected to submit the transaction slip to the bookkeeper. D. The following entries were in the Cash Journals after the 25 July 2023:  A deposit of R10 000 on 28 July 2023  EFT no. 652, R5 650 (dated 29 July 2023)  EFT no. 655, R1 445 (dated 30 July 2023) E. Bank Statement balance on 31 July 2023: R? 3.2 CREDITORS RECONCILIATION The Creditors’ Control Account and Creditors’ List of Titus Stores were prepared by an inexperienced bookkeeper. REQUIRED: 3.2.1 Indicate the changes that must be made in the Creditors’ Control Account and Creditors’ List to take into account the errors and omissions noted. Indicate an increase with a (+) or decrease with a (-) next to each amount. (9) 3.2.2 The owner of Titus Stores is not satisfied with the service and quality of goods ordered from creditor Spring Ltd. Explain TWO factors that he must consider before changing to another supplier. (4) INFORMATION: A. Balance and total: Creditors’ control balance Creditors list total R70 650 R32 600 B. Errors and omissions noted: (i) The total of the Creditors’ List was undercast by R900. (ii) A credit purchase from Mello Suppliers for R3 720 was not recorded in the books of the business. (iii) Trading stock returned to Spring Ltd, R7 200, was entered correctly in the Creditors Allowances Journal (CAJ), but was posted as R2 700 to the creditors ledger account. (iv) The Creditors Control total in the Cash Payments Journal is R16 400. The bookkeeper credited this to the Creditors Control account by mistake. (v) An invoice for R8 850 for stock purchased from Milly Market on account has been correctly recorded in the Creditors Journal, but has not been posted to their account in the Creditors ledger. 40 Copyright reserved Please turn over ### Page 10 Downloaded from hlayiso.com Accounting/P2 10 MDE/September 2023 NSC QUESTION 4: BUDGETING (40 marks; 32 minutes) You are provided with the information relating Bell Traders for the budgeted period October and November 2023. The business is owned by Jane Pilley. REQUIRED: 4.1 Complete the Debtors’ Collection Schedule for November 2023 (7) 4.2 Refer to Information H and I: Calculate (i) - (iii) as provided in the budget. Use budgeted figures in your calculations. (11) 4.3 Cash balances:  Comment on the cash balances. Provide figures. (2)  Explain how Jane can improve the cash balances in future. Provide TWO points. (4) 4.4 Calculate the following: 4.4.1 The percentage increase in rent on 1 November 2023 (3) 4.4.2 The amount of the interest on fixed deposit expected to be received in November 2023 (3) 4.5 Refer to Information H. Identify TWO payments that you consider to be poorly managed in October 2023. In EACH case, give a suggestion to improve the internal control of the items identified. (6) 4.6 Refer to Information J: Provide TWO reasons why Jane should be concerned about the control over debtors. Quote figures. (4) INFORMATION: A. The Debtors' Collection Schedule for October and November 2023. Month Credit sales October November August 2023 74 000 16 280 September 2023 68 000 27 200 ? October 2023 70 000 24 010 ? November 2023 64 000 ? Cash from debtors 67 490 ? B. Debtors pay according to the following trend:  35% is paid in the month of sale. They receive a 2% discount.  40% is paid in the month following the sales month.  22% is paid two months after the sales month.  3% is bad debts. Copyright reserved Please turn over ### Page 11 Downloaded from hlayiso.com Accounting/P2 11 MDE/September 2023 NSC C. All goods are sold at a profit mark-up of 25% on cost. D. Stock sold is replaced in the month of sale (a stock base is maintained). E. All stock is purchased on credit. Creditors are paid in the month following the month of purchase to receive a 5% early settlement discount. F. The business employs four sales assistants on the same salary scale. They will receive an inflationary increase of 7,5%, effective from 1 November 2023 An additional sales assistant will be employed on 1 November on the same salary scales as the others, but she will not receive the increase. G. A fixed deposit matures on 30 November 2023. This will be received together with interest at 8% p.a. for the last quarter of its term. H. Extract from budget for October 2023 and November 2023 October November Budgeted Actual Budgeted Receipts Cash sales 17 500 18 640 16 000 Cash from debtors 67 490 43 870 ? Rent income 11 200 11 200 12 544 Fixed deposit (including interest) - - 16 830 Payments Payments to creditors (for stock) 64 600 64 600 (i) Salaries: office staff 19 000 19 000 20 900 Salaries: sales assistants 20 800 20 800 (ii) Municipal services 10 600 10 600 11 000 Drawings 3 000 5 500 3 000 Stationery 1 200 1 250 1 200 Maintenance of office equipment 3 800 1 500 3 800 Advertising 2 400 1 000 2 400 I. After finalizing the budget, the following was identified: Cash surplus/ deficit (iii) (60 290) ? Bank balance: beginning of month 52 500 14 890 14 890 Bank balance: end of month 14 890 (45 400) ? J. Debtors' Age Analysis on 30 October 2023 NOTE: Credit terms are 30 days. Total owed Current 30 days 60 days 90 days R62 500 19 375 26 875 11 250 5 000 100% 31% 43% 18% 8% 40 TOTAL:150 Copyright reserved Please turn over ### Page 12 Downloaded from hlayiso.com GRADE 12 ACCOUNTING FINANCIAL INDICATOR FORMULA SHEET Gross profit x 100 Gross profit x 100 Sales 1 Cost of sales 1 Net profit before tax x 100 Net profit after tax x 100 Sales 1 Sales 1 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 & other receivables + Cash & cash equivalents) : Current liabilities Average trading stock x 365 Cost of sales . 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 income after tax x 100 Number of issued shares 1 Average shareholders' equity 1 (*See note below) Net income before tax + Interest on loans x 100 Average shareholders' equity + Average non-current liabilities 1 Shareholders' equity x 100 Dividends for the year x 100 Number of issued shares 1 Number of issued shares 1 Interim dividends x 100 Final dividends x 100 Number of issued shares 1 Number of issued shares 1 Dividends per share x 100 Dividends for the year x 100 Earnings per share 1 Net income after tax 1 Total fixed costs . Selling price per unit – Variable costs per unit NOTE: * 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. 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