Accounting Grade 12 Eastern Cape Mock 2015 QP (Eng)

Downloaded from hlayiso.com NATIONAL SENIOR CERTIFICATE GRADE 12 SEPTEMBER 2015 ACCOUNTING MARKS: 300 TIME: 3 hours *ACCNE* This question paper consists of 18 pages and a 17-page answer book.

Downloaded from hlayiso.com 2 ACCOUNTING (EC/SEPTEMBER 2015) INSTRUCTIONS AND INFORMATION 1. This question paper comprises SIX compulsory questions. 2. Answer ALL the questions in the special ANSWER BOOK provided. 3. Where applicable workings must be shown in order to achieve part-marks. 4. A non-programmable calculator may be used. 5. You may use a dark pencil or black/blue ink to answer the questions. 6. A breakdown of the questions is provided. You must attempt to comply with the suggested time allocation for each question. Question Topic Category Marks Minutes Cost accounting – Managerial accounting 1 Cost concepts and and managing 45 27 break-even resources Budgeting – Projected Managerial accounting 2 Income Statement and and managing 40 24 internal controls resources Companies – Financial accounting 3 Concepts and financial and managing 70 42 statements resources Companies – Cash Financial accounting Flow Statement ratio 4 and managing 60 36 analysis and resources interpretation Financial accounting VAT and 5 and managing 50 30 Reconciliations resources Stock valuation and 6 Managing resources 35 21 Problem Solving TOTAL 300 marks 180 minutes Copyright reserved Please turn over

Downloaded from hlayiso.com (EC/SEPTEMBER 2015) ACCOUNTING 3 QUESTION 1: COST ACCOUNTING (45 marks; 27 minutes) 1.1 Choose the cost account from the list provided for each of the expense listed below. Factory overhead cost; Administration cost; Selling and distribution cost; Direct labour cost; Direct material cost 1.1.1 Wages paid to employees in the production process 1.1.2 The salary of the factory foreman 1.1.3 Stationery used in the office 1.1.4 Transport cost of raw material delivered to the factory 1.1.5 Cheque paid to the Daily Dispatch for advertising (5) 1.2 MASHLE ACCESSORIES The following information was extracted from the records of Mashle Accessories for the financial year ended 28 February 2015. The business is owned by Andie Dludlu. It manufactures one type of laptop bag. REQUIRED: Calculate the following for the financial year ended 28 February 2015: 1.2.1 Total Factory Overhead Cost (11) 1.2.2 The Production Cost Statement Show all workings to earn part marks. (16) Copyright reserved Please turn over

Downloaded from hlayiso.com 4 ACCOUNTING (EC/SEPTEMBER 2015) INFORMATION: A. Stock balances: 28 FEBRUARY 2015 28 FEBRUARY 2014 Raw material stock 123 450 114 600 Work in process stock 101 400 142 400 Factory consumable stores 3 180 0 B. Summary of transactions for the year ended 28 February 2015: (before adjustments) Direct material transferred to the factory 748 000 Consumable stores purchased for the factory 31 080 Production wages 532 000 Employer’s contributions for factory employees 58 520 Salaries: Factory management (including benefits) 113 040 Sales staff (including benefits) 57 060 Water and electricity 37 220 Insurance 14 820 Sundry expenses: Factory 21 840 Sales department 9 710 C. Additional information and adjustments:  The following entry was omitted from the Production Wages Journal for the last week of February 2015: Net wage due to employee 9 240 Total deductions for this employee amounts to 23% of his gross wages The employer pays 10% to the Pension Fund and 1% to the UIF.  An amount of R3 280 was still outstanding for water and electricity. 75% of water and electricity is used in the factory.  Insurance includes an additional premium of R2 220 paid for the period 1 January 2015 to 30 June 2015. This expense is allocated between the factory and the sales department in the ratio 3 : 1. Copyright reserved Please turn over

Downloaded from hlayiso.com (EC/SEPTEMBER 2015) ACCOUNTING 5 1.3 Naidoo’s Toy Shop Naidoo’s Toy Shop makes and sells teddy bears. The accountant prepared the information presented below, for the financial year ended 28 February 2015. REQUIRED: 1.3.1 Confirm that the break-even point for 2015 is correct by doing a calculation. (4) 1.3.2 Explain whether Naidoo should be concerned about the break-even point for 2015. Quote relevant figures in your explanation. (3) 1.3.3 Provide ONE reason each for the change in the direct material cost per unit and the direct labour cost per unit. (4) 1.3.4 Provide a suitable reason for the decrease in the break-even point from 2014 to 2015. (2) INFORMATION: Goods are produced to order. As such the business does not have a work-in- process balance at year end. 2015 2014 Fixed costs R54 R53 Factory overhead cost (per unit) R36 R36 Administration cost (per unit) R18 R17 Variable costs R120 R116 Direct material cost (per unit) R52 R42 Direct labour cost (per unit) R48 R55 Selling and distribution costs (per unit) R20 R19 Selling price (per unit) R172 R172 Break-even point (units) 2 742 3 029 Number of units produced 2 640 3 200 45 Copyright reserved Please turn over

Downloaded from hlayiso.com 6 ACCOUNTING (EC/SEPTEMBER 2015) QUESTION 2: BUDGETING (40 marks; 24 minutes) You are provided with a partially completed Projected Income Statement prepared by the bookkeeper of Dawn Distributors for the period 1 October 2015 to 31 December 2015. REQUIRED: 2.1 List TWO items on the Projected Income Statement provided, that would not appear on a cash budget. (2) 2.2 Fill in the missing amounts denoted by A to E on the Projected Income Statement. (16) 2.3 Taking into account the additional information, calculate the following: 2.3.1 The percentage increase in wages that the cleaners will receive in December 2015. (4) 2.3.2 The monthly salary due to the sales manager in December 2015. (4) 2.3.3 The total credit sales expected in December 2015. (3) 2.3.4 The loan balance on 1 November 2015. (3) 2.4 Refer to the actual figures for Depreciation and Trading Stock Deficit for October 2015. In each case, provide a reason for the difference with the budgeted figures. (2) 2.5 Refer to the actual figures for October 2015. Comment on any TWO expenses (excluding items mentioned in QUESTION 2.4) that were not well controlled by the business. In each case, quote the relevant figures and give ONE suggestion on how this expense can be more effectively managed. (6) Copyright reserved Please turn over

Downloaded from hlayiso.com (EC/SEPTEMBER 2015) ACCOUNTING 7 INFORMATION: A. The business uses a mark-up percentage of 60% on cost. B. Credit sales comprise 75% of total sales. Sales are expected to increase by 10% per month and by 20% during December. C. The business employs a sales manager and an administration manager. The sales manager earns R300 more than the administration manager (per month). The managers are entitled to an increase of 8% p.a. from 1 December 2015. D. R20 000 of the loan is repayable on 30 November 2015. Interest on loan at 9% p.a. is payable every quarter. The next payment is due on 1 January 2016. E. Advertising expense per month is budgeted at a fixed percentage of total sales. F. Income tax is estimated to be 30% of the net profit before tax. G. INFORMATION (AMONGST OTHERS) FROM THE PROJECTED INCOME STATEMENT FOR OCTOBER TO DECEMBER 2015. OCTOBER OCTOBER NOVEMBER DECEMBER BUDGETED ACTUAL BUDGETED BUDGETED Sales 120 000 98 400 132 000 ? Cost of sales 75 000 58 800 B 99 000 Gross profit A ? ? Other income 20 700 18 200 20 700 21 200 Rent income 10 000 10 000 10 000 10 000 Discount received 1 200 1 000 1 200 1 200 Commission income 9 500 7 200 9 500 10 000 Gross operating income Operating expenses 48 300 ? ? Salaries (managers) 17 100 17 100 17 100 D Wages (cleaners) 3 200 3 200 3 200 3 376 Maintenance 4 000 1 650 4 000 4 000 Telephone 2 000 4 280 2 000 2 500 Insurance 1 800 1 800 1 800 1 800 Advertising 2 400 1 900 C 3 168 Depreciation 6 200 8 000 6 200 8 000 Trading stock deficit 0 680 0 500 Stationery 3 150 3 100 3 200 3 250 Sundry operating expenses 8 450 8 420 8 500 8 550 Operating profit 17 400 ? ? Interest income 225 200 200 200 Profit before interest expense 17 625 Interest expense 585 585 585 435 Net profit before income tax ? ? ? Income tax ? ? ? Net profit after tax E ? ? 40 Copyright reserved Please turn over

Downloaded from hlayiso.com 8 ACCOUNTING (EC/SEPTEMBER 2015) QUESTION 3: COMPANIES – FINANCIAL STATEMENTS (70 marks; 42 minutes) 3.1 Match the concepts in COLUMN A with the descriptions in COLUMN B. Write only the letter next to the numbers in the table provided in the ANSWER BOOK. COLUMN A COLUMN B 3.1.1 Current asset A Mortgage bond to finance the purchase of new property 3.1.2 Current liability B Distributable reserve such as Retained Income 3.1.3 Financial asset C Consumable stores not used at the end of a financial period 3.1.4 Non-current D Investment such as a fixed deposit at 9% p.a. liability interest over a 5 year period 3.1.5 Equity E Amount due to SARS in respect of income tax (5) 3.2 AMALINDA LTD The following information appeared in the accounting records of Amalinda LTD for the financial year ended 28 February 2015. The authorised share capital of the business is 700 000 ordinary shares. REQUIRED: 3.2.1 Complete the following notes to the balance sheet on 28 February 2015. (a) Fixed (tangible) Assets (15) (b) Ordinary share capital (10) (c) Retained income (12) (d) Trade and other payables. Note: All items in the Current Liabilities section of the Balance Sheet must be included under Trade And Other Payables (except Bank Overdraft). (8) 3.2.2 Calculate the net asset value per share (NAV) after the re-purchase of shares on 27 February 2015. (5) 3.2.3 The company intends issuing the balance of the authorised share capital in the next financial year. The directors proposed that a fair issue price would be R7,20 per share. (a) As an existing shareholder, what factors/financial indicators would you assess in determining whether R7,20 per share is an acceptable issue price? Provide reasons for your choices. (4) (b) V. Slink owns 52% of the shares in issue on 28 February 2015. Calculate the minimum number of shares she must purchase in order to retain her position as the major shareholder. (4) (c) V. Slink has suggested that, as a major shareholder, she should be given the first option to purchase the additional shares before they are advertised to the public. What advice would you offer the directors concerning this proposal? (3) 3.2.4 Do buying back shares have any benefit for the company? Explain. Provide TWO points. (4) Copyright reserved Please turn over

Downloaded from hlayiso.com (EC/SEPTEMBER 2015) ACCOUNTING 9 INFORMATION: A. Balances and totals (amongst others): 28 February 2015 1 March 2014 Land and buildings 2 500 000 0 Vehicles (cost) 562 500 ? Accumulated depreciation on vehicles ? 450 000 Equipment (cost) 400 300 375 500 Accumulated depreciation on equipment 189 540 141 500 Ordinary share capital ? 2 924 000 Retained income ? 89 000 Creditors control 203 900 149 600 Mortgage bond: Buck Bank 2 340 500 0 Shareholders for dividends ? 186 600 SARS: Income tax 25 500 (Cr) 18 140 (Cr) Accrued income 13 460 Accrued expenses 19 220 Income tax 281 400 Ordinary share dividends (interim dividends) 252 000 B. Fixed Assets:  On 1 April 2014, the business acquired a mortgage bond of R2 500 000 to purchase the new buildings.  On 1 March 2014, the vehicles account comprised of four delivery vehicles acquired on 1 March 2010, each for the same cost price.  On 1 November 2014, one of the vehicles was sold on credit at a loss of R4 200.  On 1 December 2014, additional equipment was bought.  Vehicles are depreciated at 15% p.a. on cost and equipment is depreciated at 20% p.a. on carrying value. C. Mortgage Bond (Loan):  The loan was acquired on the 1 April 2014 to purchase the premises.  A fixed monthly instalment (excluding interest) is paid towards the loan account. This amounted to R159 500 for this financial year.  This instalment is expected to remain unchanged in the next financial year. Copyright reserved Please turn over

Downloaded from hlayiso.com 10 ACCOUNTING (EC/SEPTEMBER 2015) D. Share capital:  On 1 March 2014, 80% of the authorised share capital was in issue.  On 1 November 2014, 120 000 additional shares were issued at R6,80 per share.  On 26 February 2015, the company re-purchased 50 000 ordinary shares from the estate of the late K. Ramza, for R7,00 per share. It was established that Mr Ramza purchased these shares through the securities exchange (JSE) at different times over the past years. E. Income tax was calculated at 28% of the net profit. F. Dividends:  A final dividend of 32 cents per share was declared on 27 February 2015. All shareholders (including the shareholders of the shares bought back) qualified for final dividends. 70 Copyright reserved Please turn over

Downloaded from hlayiso.com (EC/SEPTEMBER 2015) ACCOUNTING 11 QUESTION 4: CASH FLOW AND INTERPRETATION (60 marks; 36 minutes) You are presented with information from the records of Pixie Ltd for the financial year ended 30 June 2015. REQUIRED: 4.1 Calculate the following amounts that would appear on the Cash Flow Statement. Show all workings to earn part marks. 4.1.1 Dividends paid (5) 4.1.2 Income tax paid (4) 4.1.3 Fixed assets purchased (5) 4.1.4 Total cash spent on investing activities (4) 4.1.5 Net change in cash and cash equivalents (4) 4.2 Calculate the following financial indicators for the financial year ended 30 June 2015: Round off calculations to ONE decimal point (where applicable). 4.2.1 Stock holding period (4) 4.2.2 Debtors average collection period (6) 4.2.3 Debt/equity ratio (3) 4.3 Comment on the management of stock (trading inventory). Quote TWO relevant financial indicators (with figures) in your answer. (6) 4.4 Is the management of debtors and creditors effective? Explain. Quote relevant financial indicators and/or figures in your answer. (6) 4.5 John Cann (your friend) wants to buy shares in a company. He produced the financial indicators of Vivi Traders LTD (another company that operates in the same industry as Pixie LTD) and asked for your advice. Explain your answers to the following questions. In each case compare and quote the relevant financial indicators (figures, ratios or percentages) of both companies to support your explanations. 4.5.1 Comment on the earnings per share (EPS), the dividends per share (DPS) and the return on shareholders’ equity (ROSHE) for both companies. (6) 4.5.2 Comment on the financial gearing of both companies. Explain which company is making more use of loans and state whether it is a good idea or not, for that company to do so. (4) 4.5.3 Refer to the market value of the shares and the net asset value per share. What advice would you offer John Cann about investing in either company? (3) Copyright reserved Please turn over

Downloaded from hlayiso.com 12 ACCOUNTING (EC/SEPTEMBER 2015) INFORMATION: A. Information from the Income Statement on 30 June 2015. Sales 1 984 000 Cost of sales 1 452 000 Depreciation 64 000 Interest expense 72 000 Net profit before income tax 257 400 Income tax 75 600 B. Information from the Balance Sheet 30 June 2015 30 June 2014 Non-current assets 1 665 400 1 321 500 Fixed assets 1 505 400 1 201 500 Financial assets 160 000 120 000 Current assets 270 100 196 500 Inventories (Trading stock) 176 000 120 200 Trade and other receivables (Trade debtors) 70 200 65 500 SARS: income tax - 8 800 Cash and cash equivalents 23 900 2 000 Total assets 1 935 500 1 518 000 Shareholders’ equity 1 006 800 843 000 Ordinary share capital 950 000 800 000 Retained income 56 800 43 000 Non-current liabilities 740 000 520 000 Current liabilities 188 700 155 000 Trade and other payables 110 200 95 500 Shareholders for dividends 66 000 42 000 SARS: income tax 12 500 - Bank overdraft 17 500 1 935 500 1 518 000 C. Share capital and dividends. The company has an authorised share capital of 500 000 ordinary shares. On 30 June 2015, there were 300 000 shares in issue. Additional shares were issued at R3,00 each on 31 August 2014. All shares in issue were entitled to interim and final dividends. An interim dividend was paid on 2 January 2015. A final dividend was declared on 27 February 2015. D. Additional fixed assets were purchased during the financial year. An old vehicle was sold at its book (carrying) value of R23 500 during the financial year. E. Credit sales amounts to 40% of total sales. Copyright reserved Please turn over

Downloaded from hlayiso.com (EC/SEPTEMBER 2015) ACCOUNTING 13 F. The following financial indicators were calculated on 30 June: 30 JUNE 2015 30 JUNE 2014 Current ratio 1,43 : 1 1,27 : 1 Acid test ratio 0,5 : 1 0,49 : 1 Stock turnover rate 9,8 times 11 times Stock holding period ? 33 days Debtors average collection period ? 38 days Creditors average payment period 65 days 62 days Solvency ratio 2,08 : 1 2,25 : 1 Debt/equity ? 0,62 : 1 Return on average capital employed 21,2% 22% (ROTCE) Return on shareholders’ equity (ROSHE) 19,7% 24% Earnings per share (EPS) 63 cents 72 cents Dividends per share (DPS) 56 cents 52 cents Current interest rate on loans 11% 10,5% G. Financial indicators of Vivi Traders LTD for the financial year ended 30 June 2015 compared to Pixie Ltd above. Pixie LTD Vivi Traders LTD Market price per share (JSE) 345 cents 315 cents Net asset value per share (NAV) 336 cents 342 cents Earnings per share (EPS) 63 cents 92 cents Dividends per share (DPS) 56 cents 46 cents Return on average capital employed 21,2% 10,8% (ROTCE) Return on shareholders’ equity (ROSHE) 19,7% 9,6% Debt/equity ratio ? 0,52 : 1 Current ratio 1,43 : 1 4:1 Acid test ratio 0,5 : 1 1,6 : 1 60 Copyright reserved Please turn over

Downloaded from hlayiso.com 14 ACCOUNTING (EC/SEPTEMBER 2015) QUESTION 5: VAT AND RECONCILIATIONS (50 marks; 30 minutes) VAT 5.1 Answer the following questions in the space provided in the answer book. Write the answer only, next to each number. 5.1.1 What does VAT stand for? (1) 5.1.2 Indicate whether the following statements are True or False. (a) All goods and services are subject to VAT at the standard rate. (b) It is compulsory for all businesses to register for VAT. (2) 5.1.3 Choose the correct answer from the alternatives provided. VAT paid by a business when goods are purchased is referred to as (Input VAT / Output VAT). (1) 5.2 The information presented, appeared in the books of Lucky Stores for the VAT period ended 30 June 2015 (two months). VAT is applicable at 14%. REQUIRED: 5.2.1 Calculate the total credit sales for the period (excluding VAT). (2) 5.2.2 Taking into account the errors and omissions, calculate the amount that is either payable to or receivable from SARS for VAT. (11) 5.2.3 The internal auditor, through a random check, discovered that the owner, Joe, does not pay the full amount due to SARS on due dates. On enquiry, Joe stated that he spends the money on the business.  What advice would you offer Joe concerning this practice? (3) INFORMATION: A. Amount due to SARS on 1 June 2015, R9 889. B. VAT amounts extracted from the journals: VAT received from cash sales CRJ 19 800 VAT on credit sales DJ 12 320 VAT on trading stock purchased CJ 13 356 VAT on returns from debtors DAJ 672 VAT on goods taken by the owner for personal use GJ 91 VAT on debtors accounts written off GJ 63 C. The following errors and omissions were noted:  Cash sales (inclusive of VAT) during this period were R141 930. The VAT amount above (CRJ) was calculated incorrectly.  The VAT on discounts allowed to debtors amounting to R1 260 was not recorded in the books of the business.  An invoice for R850 (excluding VAT) for stationery purchased on credit was not recorded in the respective journal. Copyright reserved Please turn over

Downloaded from hlayiso.com (EC/SEPTEMBER 2015) ACCOUNTING 15 5.3 CREDITORS RECONCILIATION: MJ Stores buys goods on credit from Braeside Dealers. You are presented with information from the records of MJ Stores for October 2014. REQUIRED: Use the table provided to indicate the changes that must be made to the statement received from the creditor, Braeside Dealers, and the Creditors Ledger account in the books of MJ Stores. (9) INFORMATION: A. The statement received from Braeside Dealers on 30 October 2014 reflected an outstanding balance of R12 540. B. The Creditors’ Ledger Account of Braeside Dealers in the books of MJ Stores showed that only R5 350 was due to Braeside Dealers on 31 October 2014. C. An investigation revealed the following: i Returns recorded as R820 in the creditors ledger account of Braeside Dealers was shown as R280 on the statement received. The amount on the statement was correct. ii An invoice for R4 200 received from Braeside Dealers was incorrectly recorded as a credit note by the clerk of MJ Stores in the creditors’ ledger. iii An invoice received from Braeside Dealers was correctly recorded as R4 400 in the Creditors’ Ledger Account of Braeside Dealers in the books of MJ Stores, but the statement showed this amount as R400. iv A payment of R5 000 made by MJ Stores appeared on the statement received. The statement also reflected a discount of R250 for early payment. MJ Stores did not record the discount in the creditors’ ledger. v A payment of R2 500 to Braeside Dealers on 27 October 2014 did not appear on the statement, due to the statement being processed early. Copyright reserved Please turn over

Downloaded from hlayiso.com 16 ACCOUNTING (EC/SEPTEMBER 2015) 5.4 DEBTORS RECONCILIATION You are provided with information relating to Marlin Traders for July 2015. REQUIRED: 5.4.1 Give TWO steps that the bookkeeper must follow when he/she discovers a difference between the Debtors Control Account and the Debtors List. (2) 5.4.2 Refer to Information A. Show the effect of the errors and omissions to the Debtors Control Account in the General Ledger and to each Debtor’s Account in the Debtors Ledger. (Complete the tables provided.) (11) 5.4.3 Refer to Information B. (Debtors’ Age Analysis) (a) Explain why you would be concerned about the management of debtors in this business. Quote relevant figures in your answer. (4) (b) Provide TWO internal control measures that the business can use to improve the collection of money from debtors. (4) INFORMATION: A. Errors and omissions: i The total of the Debtors Allowances Journal was under cast by R120. ii Stock sold on credit to M. Mouse was wrongly entered in the journal as R890 instead of R980 and posted accordingly to the debtors’ ledger. iii Interest of R75 must be charged to the overdue account of D. Duck iv A cheque for R530 received from K. Chicken was returned by the bank marked R/D. No entries were made for this transaction. v Goods sold to F. Fox for R1 320 was incorrectly posted to the account of M. Mouse. The entry in the journal was correct. vi A receipt issued to M. Mouse for R650 was correctly recorded in the journal but was posted to the Debtors Ledger Account as R600. B. On 31 July 2015, the Debtors’ Age analysis was as follows: Credit terms: 30 days less 5% discount. 30 – 60 61 – 90 MORE THAN TOTAL CURRENT DAYS DAYS 90 DAYS 23 180 4 636 6 954 9 272 2 318 50 Copyright reserved Please turn over

Downloaded from hlayiso.com (EC/SEPTEMBER 2015) ACCOUNTING 17 QUESTION 6: STOCK VALUATION AND PROBLEM SOLVING (35 marks; 21 minutes) The information presented appeared in the books of Phelix Traders. The business is owned by Max Phelix. It sells a single brand laptop. The financial year ended on 28 February 2014. REQUIRED: 6.1 Refer to Information A and B: Calculate the value of the closing stock using the first-in-first-out (FIFO) method of stock valuation. (10) 6.2 Calculate the cost of sales of the laptops sold. (6) 6.3 Max wants to change his stock valuation method to either the weighted average method or the specific identification method.  How would a change in policy impact on the financial reporting of the business? Give ONE point. (2) 6.4 Taking into account the technology market, what advice can you offer Max regarding his marketing strategy and his pricing policy? Provide TWO points. (4) INFORMATION: A. UNIT Transport NUMBER TOTAL PRICE cost OF UNITS (R) per unit (R) Stock balance on 1 March 2013 15 3 400 51 000 Total purchases for the year: 62 329 360 May 2013 12 4 250 230 53 760 August 2013 20 4 740 250 99 800 November 2013 14 5 520 260 80 920 January 2014 16 5 650 280 94 880 Units returned to suppliers * 7 ? ? Stock balance on 28 February 2014 17 ? ? B. *Units returned to suppliers:  3 units from the August purchased were returned because they were not according to the order placed.  4 units from the January batch were returned due to minor damages in transit.  In both cases the transport cost was borne by the business. C. Laptops are sold at a fixed selling price of R7 500 each. Copyright reserved Please turn over

Downloaded from hlayiso.com 18 ACCOUNTING (EC/SEPTEMBER 2015) 6.5 PROBLEM SOLVING Siddie Traders LTD has THREE branches at popular shopping malls selling a single brand of cookware. Although the business is making a profit, Siddie is concerned about the profitability of each branch. She decided to investigate and presented the information below, for June 2015 (one month). REQUIRED: 6.5.1 Identify a different problem (with relevant figures) in each of the branches. (6) 6.5.2 Identify ONE branch that Siddie should consider closing down. Provide a valid reason for your choice. (3) 6.5.3 Give Siddie ONE suggestion to address the problem identified in QUESTION 6.5.1 for each of the other branches. (4) INFORMATION: The shops are open 7 days a week. Normal time is from 8:30 am to 4:30 pm, Mondays to Fridays (160 hours per month) Overtime is from 4:30 pm to 6:30 pm Mondays to Fridays and from 9:30 am to 12:30 pm on weekends (56 hours per month) Overtime salary rate is 1,5 times the normal rate. MENLYN MOORTON VINCENT BRANCH BRANCH BRANCH Salesperson (age) Sally (42 years) Tim (27 years) John (62 years) Stock on hand (1 June 50 units 50 units 50 units 2015) Selling price per set R4 200 R4 200 R4 200 Sets sold 42 36 22 Sets returned 5 12 1 Credit sales R54 600 R88 200 R21 000 Deposits from cash sales R79 800 R12 600 R67 200 Hours worked (normal time) 154 hours 117 hours 102 hours Overtime hours 20 hours 52 hours 2 hours Rent expense (per month) R6 000 R8 000 R5 500 35 TOTAL: 300 Copyright reserved Please turn over

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