Accounting Grade 12 Paper 2 KZN June 2025 Memo

KWAZULU-NATAL PROVINCE EDUCATION REPUBLIC OF SOUTH AFRICA NATIONAL SENIOR CERTIFICATE GRADE 12 ACCOUNTING P2 MARKING GUIDELINES JUNE EXAMINATION 2025 2M. MCHAE MARKS: 150 Heneean | Bhar (4h Hf 02S” ie MARKING phos LES: = ay fom fre ak Penalties for foreign items are applied only if the candidate is not losing marks elsewhere in the question for that item. No double penalty applied. Penalties for placement or poor presentation (e.g. details) are applied only if the candidate is earning marks on the figures for that item. Full marks for correct answer. If answer incorrect, mark the workings provided. if a pre-adjustment figure is shown as the final figure, award one mark. 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. 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. Where indicated, part-marks may be awarded to differentiate between differing qualities of answers from candidates. 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. Where penalties are applied, the marks for that section of the question cannot be a final negative. Where method marks are awarded for operation, the marker must inspect the reasonableness of the answer before awarding the mark. Operation’ means ‘Check operation’. ‘One part correct’ means ‘Operation & one part correct’. Note: check operation must be +, -, x, +, or per candidates operation. In awarding method marks, ensure that candidates do not get full marks for any item that is incorrect, indicate with a &. Note: do not award marks for workings if numerator and denominator are swapped-this also applies to ratios. Be aware of candidates who provide valid alternatives beyond the marking guideline. Codes: f=foreign item; p=placement. This marking guideline consists of 9 pages. Copyright Reserved Please Turn Over

2025 June Examination QUESTION 1 1.1.1 | Provide THREE points for good internal control over creditors Any three valid and separate points ¥ “ vv vv Beware of alternative wording which reflects the same point. Beware that two separate points could be in the same sentence. » Assess the efficiency of the creditors clerk in order to prevent errors from occurring « Ensure that creditors are paid on time to make use of discounts e Make full use of credit terms to assist cash flow e Division of duties amongst members of the accounting department so that one person serves as a check on another e Reconcile the balance cn the creditors control account with the total of creditors' list to ensure accuracy on a monthly basis e The statement of account of individual creditors must be reconciled (agreed) with their accounts in the creditors ledger e Conduct internal audits to minimise the possibility of fraud or error / Check documents (e.g. invoices and credit notes) to ensure accuracy of calculations and entries e Ensure that items ordered fram creditors are correctly received (i.e. quantities, condition, price) e Ensure that ail purchases are correctly authorized (i.e. procurement policy) 6 1.1.2 No. Creditors’ Ledger of Statement of account received Makhedama Stores from Kranskop Ltd. Balance R114 485 R182 150 A. -9 500 -9 500 B +87 000% c. +6 900%Y D -1 350V¥ E. -730V4 FE. +2 000“%Y G -5 350% -5 350% or . -10 700 2marks H. +1 215VV l. 14600%4% TOTAL 183 285M@* operation 183 285M@* operation = * Any One part correct, check reasonableness and Including opening figures Totals do not have to agree Wy +G (% Sign and amount must be correct to award mark(s) If no sign accepts it as a positive, Accept brackets as a negative figure Foreign / superfluous entries -1 each line. Copyright Reserved Please Turn Over

2025 June Examination 1.2 DEBTOR’S AGE ANALYSIS AND INTERNAL CONTROL 1.2.1 | Caiculate the percentage of debtors’ balances amounts that are within the credit term of the business. 10 120 + 9 380 x 100 31 800 “7 = 61.3% Vv 2 1.2.2 | The business is not controlling its debtors effectively. Give THREE reasons why you would agree with this statement. Quote figures. ReasonY ¥ Vv Debtor &figurev Y¥ Vv Debtors are not setiling | Nel, R4 900, Ngubane R4 500, outstanding balance within the 30 | Luthuli R2 900 days credit term Debtors exceeded their credit limit | Ras by R1 120, Luthuli by R600 Credit being currently offered to | Ngubane R1 500, Luthuli R3 420 debtors who are not adhering to credit terms 6 1.2.3 | Tatjana is of the opinion that her debtors’ clerk does not screen (check) potential customers properly before offering credit facilities. Give TWO strategies that the debtors' clerk should follow before allowing customers to open accounts. Any two valid responses to explain screeningvv vv e New debtors must provide ID documents » Proof of residence e New debtors must provide three credit references which the debtors clerk must check for good payment records e Debtors must provide proof of income e.g. salary slip 4 TOTAL MARKS 35 hats § 6 Copyright Reserved Please Turn Over

2025 June Examination QUESTION 2 2.1.1 2.1.2 2.1.3 2.2.1 Copyright Reserved Direct labour cost CALCULATION ANSWER 10 X 2 000 X 50 = 1 000 000MM two or nothing 40 X 100 X 90 = 90 000Y ¥ two or nothing 1 000 000M X 12/100 = 120 000Y 1210 000M Check the above calculation for basic wages operation on part correct a Factory overheads cost TOTAL 764 780 Rent expenses 16 500’ ¥ two or nothing Insurance (17 280) ¥¥ two or nothing 764 000 5 Production Cost Statement for the year ended 28 February 2025. Direct material cost 1500000 v Direct labour cost see 2.1.1 1210000 Prime cost operation on part correct 2710000 4 Factory overhead cost see 2.1.1 764000 4 Total manufacturing cost (PC + FOH) 3474000 4 Work in progress at the beginning 26 000 3 600 000 Work in progress at the end of the year (24000) wi Operation The total cost of production of finished goods 4 (3 200 000Y + 552 000 — 276 000~) acacia 40 Provide TWO reasons why the factory workers choose to work overtime without any concern. Any relevant answerv¥ vv e Passion for work to achieve positive results / Contribution towards company success. s Demonstrate commitment and reliability to employers to meet business targets. 4 e Due to financial incentives. e Demonstrate dedication leading to promotion. Calculate the break-even point for the year ended 28 February 2025. 2.442 375¥ pa G (* 104.10Y — 36.10% = 35 917.3 or 35 918 units one part correct 4 Please Turn Over

2025 June Examination 2.2.2 | Explain whether the level of production achieved is satisfactory or not. Quote figures to support your opinion. ExplanationYY — figures Vv Satisfactory” The business produces 41 750 units, and the BEP is 35 918 / produce 5 832 more than lhe BEP / making a profil on 5 832 units TWO —mark options (if only production or only BEP) 4 Produce last year 42 500 and this year 41 750 / 750 less than last year. BEP increased from 34 244 to 35 918 by 1 674 units 2.2.3 | Pep is generally satisfied with the management of variable costs but is not pleased with the contro! over direct labour costs. Justify his concern by quoting figures. Comparative figures VY Direct labour cost increased from R9.80 to R14.70 by R4. 90 / 50% Provide THREE suggestions he can implement to address the probiem. Any THREE suggestions v “ VY Vo Possible answers: Train workers to work effectively Restrict overtime Better supervision by the foreman Pay workers per finished unit (piecework) / set targets 2.2.4 | Pep is considering using computerised machinery as an alternative to manual labour. This may result in some workers losing their jobs. Explain TWO points that he should consider before taking this step. Any TWO suggestion ¥ Vv vv e Triple bottom line (They should not only consider their profit) retrenching workers will add to poverty/ increased crime/ unemployment within the community. Maintenance and installation of computerized machinery are costly. a Computerised machinery will need constant power and the current load- reduction situation will bring production to a stand. e Computerised machinery will need substantial initial capital investment, which can lead to cash flow pressure 2.2.5 | Pep wants to increase production by 800 units during the next financial year while maintaining costs. Calculate the additional profit that he will achieve. Calculation Answer 800“ X 68" Hl check 2.2.1 54 400 41 One part correct 4 TOTAL MARKS bors G —| Copyright Reserved Please Turn Over

QUESTION 3 2025 June Examination 3.1.1] Explain TWO differences between the perpetual stock system and the periodic stock system. Any valid difference with comparisonyv¥Y v¥ Incomplete / one system only explanation: 1 mark Expected responses: perpetual stock system periodic stock system Stock on hand is available at all times, | Stock on hand is available through electronically. physica! stock-take. Cost of sales is available at the point of | Cost of sales is calculated and this sales is done usually at the end of the _ financial year. Stock purchased is recorded as an Stock purchased is recorded as an asset. expense. 4 3.1.2 | Calculate the following: (i) Customs duty paid per watch 18 000/12 = 150 v OR 12 150/81 = 150 OR 40 500 270 (18 000 + 12 150 + 10 350) + (120 + 81 + 69) = R150 4 (ii) | The value of closing stock using weighted average method 3 803 500 _+ 9 348 000” + 40 500” + 13 500” - 175000” 100V + 270V - 5” 13.030 500_award five marks 365 award three marks R35 700 x 78 units ¥ R 2 784 600M closing stock 11 (iii) Cost of sales Ants G (% See weighted above See closing stack above 13 030 500M — 2 784 600 M= 10 245 900M OR (365 -78) one mark X35 700 one mark = 10 245 900 one mark 3 Copyright Reserved Please Turn Over

2025 June Examination (iv) Calculate the Stock holding period in days accept “Av (3 803 500¥ +2784 600M) X 365 | (100 +78) X 365 10 245 900Msee cost of sales above 1 287 3.294 050 award three marks =X 365 45D days 10 245 900 1 117.3 days¥ operation on part correct 3.1.3 | Comment on stock holding period ( 2024 was 158 days) Stock holding period improved’ from 158 days to 117 days by 41 days¥ Watches were on demand / Advertising was more efficient 3.2.1 | Comment on the price adjustment policy. Is it a good idea to allow the managers to adjust prices? Provide figures to support your answer. Mthembu decreased his prices by 10% and his sales are the highest. “ Shabalala increased his prices with 5% and he had the lowest sales. It is a good policy to allow managers to give discounts, but they should not be allowed to increase prices. Vv 3.2.2 | Identify one problem relating to each shop. Provide figures to support your answer. In each case provide a possible solution. Identify a problemvVYv Vv v¥ | Possible solutionY Vv v Accept any relevant answer 120 days’ stock on hand Keep less stock SHOP A | Pay creditors to soon in 30 days | Pay creditors later Gross profit margin / mark up is | Give less discount 10% lower Sell on credit SHOP B | No credit sales, RO / nil Pay creditors later Too many workers 10 Transfer some workers to other shops Workers to take turns in coming to work Sales are the lowest at R247 500) Prices must be decreased SHOP C | Give too much credit 222 750 Improve credit control (90%) Introduce commission on sales Bad debts very high 22 275 Handover to debt collectors (91%) Fray me) TOTAL MARKS (% 40 Copyright Reserved Please Turn Over

2025 June Examination QUESTION 4 BANK RECONCILIATION 4.1.1 Cash Receipts Journal Cash Payments Journal 132 890 73 200 8500 ¥ 420 ¥ 2600 ¥ 1550 ¥ 950 v¥ 7 144 940 75 170 4.1.2 | Calculate the correct balance of the Bank account in the ledger on 30 April 2025. 1 930 “+ 144 940 Mi — 75 170 Ml =71 700 & one part correct See CRJ See CPJ Accept ledger account Check the net effect 4 4.1.3. TWO COLUMN METHOD: If both methods answered , mark both and choose the option that benefits the candidates Prepare the Bank Reconciliation Statement on 30 April 2025. Debit Credit Balance as per bank statement Could be ORICR 56 350 a | Balancing figure | D2 Not accept R36 294 Y Outstanding deposit 23100 ¥ Outstanding EFT 176 4130 ¥ 201 5100 ¥ 202 3150 ¥ Correction: Easy deduction order 3000 ¥ Correction: EFT 175 270 ¥ Correction bank charges 1900 ¥ Balance as per bank account 71700 See 4.1.2 10 84 350 84 350 Copyright Reserved Please Turn Over

2025 June Examination QUESTION 4 BANK RECONCILIATION 4.1.1 Cash Receipts Journal Cash Payments Journal 132 890 73 200 8500 ¥ 420 ¥ 2600 ¥ 1550 ¥ 950 ¥ 7 144 940 75 170 4.1.2 | Calculate the correct balance of the Bank account in the ledger on 30 April 2025. 1930 “+ 144 940 HM -— 75 170 MH = 71 700 Hf one part correct See CRU See CPJ Accept ledger account Check the net effect ri 4.1.3. TWO COLUMN METHOD: If both methods answered , mark both and choose the option that benefits the candidates Prepare the Bank Reconciliation Statement on 30 April 2025. Debit Credit Balance as per bank statement Could be DRICR 56 350 Balancing figure | D9 Not accent R36 294 v Outstanding deposit 23100 ¥ Outstanding EFT 176 4130 ¥ 201 5100 “ 202 3150 ¥ Correction: Easy deduction order 3000 ¥ Correction: EFT 175 270 v¥ Correction bank charges 1900 ¥ Balance as per bank account 71 700 See4.1.2 10 84 350 84 350 Copyright Reserved GMs Please Turn Over

2025 June Examination OR ONE COLUMN METHOD: Refer marking conditions applicable above, Be alert to candidates who start with the bank account balance" Note: brackets / no brackets must be reversed. See shaded column. Prepare the Bank Reconciliation Stat Balance as per bank statement 56350 Mv Outstanding deposit 23100 ¥ Outstanding EFT 176 (4130) ¥ 201 (6100) ~ 202 (3150) “ Correction: Easy deduction order 3000 ¥ Correction: EFT 175 (270) ¥ Correction bank charges 1900 ¥ Balance as per bank account 71 700 10 4.1.4 | Provide ONE reason why the internal auditor should be concerned about the control of cash. Provide a solution for his concern. Reason with a figureYY Solution V¥ e Rolling over of Cash R23 100 e Missing money on 2 April 2025 (23 100) e Donation for R950 to local school e Use the collection companies to collect cash on a daily basis/ cash in transit. e Register for SMS notification from the bank e Visit the place before donating/verify existence. TOTAL MARKS 25 Copyright Reserved huss (%* TOTAL MARKS: 150