ACC Grade 12 Revision Marking Guidelines

NAR Ea NEG OF UM Oty pe AMALV ELS ADE Til PRETATION OF FINANCIAL INFORWIATION GRADE 12 Department of Basic Education 222 Struben Street, Pretoria, 0001 Private Bag X895, Pretoria, 0001, South Africa Tel: (012) 357 3000 Fax: (012) 323 0601 / Hotline: 0800 202 933 EXPLORE ITON. AppGallery website facebook www.education.gov.za www.facebook.com/BasicEd S. £ education eto Tht Baker Botina Noord Departenent van Ondernys Nor Wes Deparment of Education NonrH west pRoviNce Grade 12 ISBN NO. 978-1-4315-3284

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5. Check your Answers ACTIVITY 4 (1.4) Note 1: Cash generated from operations Net Profit before tax ¥100 000 Add: Depreciation ¥58 000 Add: Interest expense : ¥27 380 Sub-total M1185 380 Net change in working capital (37 870) Changein inventory ¥v12 000 Change in receivables ¥ ¥ (59 720) Change in payables v v9 850 Cash generated from operations 1147 510 1.2 CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2018 CASH EFFECT OF OPERATING ACTIVITIES 29130 w Gash generated from operations 147 510 Interest paid (27 380) | “ Dividends paid (60 000% + 22 000v — 28 000’) (54 000) | Income tax paid (10 000v + 4 000M + 23 000v’) (37 000) | 4 CASH EFFECT OF INVESTING ACTIVITIES (187 000) ; Z Fixed assets purchased (549 000” + 58 000V + 17 000v — 420 000”) (204 000) Proceeds from disposal of fixed assets 17 000] ¥ CASH EFFECT OF FINANCING ACTIVITIES 198 000 | Z Proceeds from shares issued 638 000 | Repurchase of shares (400 000) | ¥ Decrease in loan (40 000) | ¥ NET CHANGE IN CASH AND CASH EQUIVALENTS 40 130 | ¥ Cash and cash equivalents at beginning of year v (10 000% + 1 000") (9 000) Cash and cash equivalents at end of year 31130 4 27 ACTIVITY 2

2.1 Provide the missing figures indicated by A to F in the Cash Flow Statement. Show workings to earn part-marks. A 1188 000 v B_ | (1 600 000 ~ 1 120 000) 480 000” + 28 000Y + 14 000” = (522 000) MO C | 200 000” + 270000” = (470 000) MIT) Or 495 000 + 200 000 — 225 000 = (470 000) D | 7350 000V + 425 000v'+ 86 000V — 6 931000” = (930 000) E | 86 000” F | 150 000 x 8 = 1 200 000 vv G | 57 500 x 6 = (345 000) vv H_ | 2.800 000 — 2 100 000 = (700 000) vv 1 | 99 000” + 120 000” = 219 000M J | 2000Y ~ 122 000” = (120 000)NM K | 99 000”

ACTIVITY 3 MPUMALANGA LIMITED NOTES TO THE CASH FLOW STATEMENT RECONCILIATION BETWEEN NET PROFIT BEFORE TAXATION AND CASH GENERATED FROM OPERATIONS Net profit before tax ¥ 625 000 Adjustment in respect of: Depreciation ¥187 500 Interest on Loan ¥115 000 Operating profit before change in working capital 927 500 Net change in working capital 123 600 Decrease in inventory vv 5 000 Increase in Trade and other receivables(1125000 — vv 1139000) 14 000 increase in Trade and other payables(955 000 — Vv 850 400) 104 600 Cash generated from operations M1 051 100 Calculate the figure for Income Tax that appeared in the Cash Flow Statement on 30 June 2018 = 187500 v—5 000 v- 18 000"= 210 500 4 + 187500 + 5000 + 18 000 = 210 500 Calculate the figure for Dividends that appeared in the Cash Flow Statement on 30 June 2018 74 000 V+ 96 000% = (170 000) ¥ 326 000 + 74 000 — 230 000 = 170 000

Cash flow from investing activities Fixed assets purchased (1 039 500%+18 500” + 19 430v- 774 800V) (302 630) Proceeds from thesale of fixed assets 419 430¥ Fixed deposit matured 50 000V (233 200) 4 Cash flow from financing activities Proceeds from the sale of shares (80 000 x R15) 1 200 000V¥ Repurchase of shares (20 000 x R14) (280 000) vv Repayment of loan (970 000 — 450 000) (520 000) vv 400 000M ACTIVITY 4 TAMBO LIMITED 41 Calculate the amount that would appear in the Cash Flow Statement for: 4.1.1 Taxation paid + 33 800 V+ 303 880V + 8 400V = 346 080M — 33 800— 303 880 — 8 400 =-346 080 (33 800) (303 880 (8 400) =(346 080) 44.1 Dividends paid 98 000 V+ (202 000%— 130 000 M4) = 170 000 4 OR 98 000 + 72 000 two marks= 170 000

4.1.2 4.4.3 Prepare the following note to the Cash Flow Statement Net profit before tax 995 900 Adjustment for : Depreciation 135 700 Interest on loan/expense ¥ 76500 Profit before change in working capital M1 208 100 Change in Working capital 158 000 Decrease in inventory (174 000 — 112 000) ¥ ¥62 000 Decrease in debtors 136 400 (119 600 “ ~ [122 000 v + 34 000) Decrease in creditors M(40 400) ([94 600 v + 9 000]v— 144 000” Cash generated from operations M1 286 100 14 Cash flow from investing activities M (408 390) Purchase of fixed assets ¥ (880 000) | Proceeds from sale of non-current assets M61 610 (1 101 500%+ 680 000” — 135 700V— 1 584 190) Decrease in investments ¥¥210 000 (960 000 -750 000) 9 Cash flow from financing activities M278 000 Proceeds from the issue of share capital ¥ 383 000 Repurchase of shares (10-000 x R2,50) vv (25 000) Repayment of long-term borrowings ¥ (80 000) Net change in cash equivalents ¥334 100 Cash and cash equivalents ~ beginning (5 400 — 203 500) vv (198 100) Cash and cash eguivalents — end ¥136 000

6. Message to grade 12 learners from the writers “Begin with the end in mind.” At the end of your journey in the GET phase, you were required to choose a subject set that will shape your career path. Hopefully, your choice was based on your aptitude, ambition and desire to become a successful individual, with a comfortable standard of living. Let's be frank! Accounting is not for the faint-hearted. There are NO short-cuts. Success in Ac- counting demands hard work and dedication, but the rewards are satisfying. Questions and topics covered in the examination papers are very predictable. You need to just extract the NSC papers for the last three years from the internet and compare the questions. If you do this, you will become familiar with the commonly asked questions and the style and format of the paper. You will also gain insight into the different ways in which questions can be asked. Practice every day, do not be afraid to ask questions, engage in group studies and attend the many intervention programmes organized by your school and your Department of Education. Effective planning ensures that you: Know the rules of the game and play it better than others.z “IT ALWAYS SEEMS IMPOSSIBLE UNTIL IT'S DONE.” - Nelson Mandela

7. Thank you This Accounting module on the Cash Flow Statement was developed by Mr P Govender, Mr A Leeuw, Mr M.P Shabalala, Mr Dorian Olifant and Ms ZJM Mampana (Subject Specialists, PED) A special mention must be made of Mr Mzikaise Masango, the DBE curriculum specialist who, in addition to his contribution to the development of the guide, also coordinated and finalised the process. These officials contributed their knowledge, experience and in some instances unpublished which they have gathered over the years to the development of this resource. The Department of Basic Education (DBE) gratefully acknowledges these officials for giving up their valuable time, families and expertise to develop this resource for the children of our country. Administrative and logistical support was provided by Mr Noko Malope and Ms Vhuhwavho Mage- legeda. These officials were instrumental in the smooth and efficient management of the logistical processes involved in this project. Look out for more modules that deal with other topics of the Grade 12 syllabus.