Accounting Grade 12 NSC November 2013 Memo (English)

Downloaded from hlayiso.com NATIONAL SENIOR CERTIFICATE GRADE 12 ACCOUNTING NOVEMBER 2013 MEMORANDUM MARKS: 300 MARKING PRINCIPLES: 1. 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). No double penalty applied. 2. Full marks for correct answer. If answer incorrect, mark the workings provided. 3. If a pre-adjustment figure is shown as a final figure, allocate the part-mark for the working for that figure (not the method mark for the answer). 4. 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. 5. Where indicated, part-marks may be awarded to differentiate between differing qualities of answers from candidates. 6. Where penalties are applied, the marks for that section of the question cannot be a final negative. 7. Where method marks are awarded for operation, the marker must inspect the reasonableness of the answer before awarding the mark. 8. In awarding method marks, ensure that candidates do not get full marks for any item that is incorrect at least in part. 9. Codes: f = foreign item; p = placement/presentation. This memorandum consists of 18 pages. Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 2 DBE/November 2013 NSC – Memorandum QUESTION 1 1.1 CONCEPTS Choose the correct word(s) from those given in brackets. Write only the word(s) next to the question number (1.1.1–1.1.3). 1.1.1 Business entity concept  1.1.2 Limited  1.1.3 Receivables  6 1.2 COMPANY TRANSACTIONS Use the table provided to indicate the following for each transaction: • Account debited and account credited in the General Ledger • Effect on the accounting equation The bank balance is favourable at all times. Additional item / Foreign item in AOL -1 ACCOUNT ACCOUNT NO. AMOUNT A O L DEBITED CREDITED e.g. Directors' Fees Bank 145 000 − − 0 SARS (Income 1.2.1 Tax)  Bank  37 400 - 0 - Ordinary 1.2.2 Bank Share Capital 180 000 + + 0 Dividends on Ordinary Shareholders for 1.2.3 Shares/Ordinary Dividends  55 000 0 - + Share Dividends  12 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 3 DBE/November 2013 NSC – Memorandum 1.3 DEBTORS' RECONCILIATION 1.3.1 CORRECTIONS TO THE DEBTORS' CONTROL ACCOUNT Current Debtors' Control Account balance 20 100 A. -1 800  B. + 200  C. - 900  D. No change  E. +1 400  Correct Debtors' Control Account balance 19 000  7 Must include R20 100, Inspection, reasonable or see 1.3.2 1.3.2 DEBTORS' LIST ON 30 SEPTEMBER 2013 -3 200+2 300 (1 mark) 2 900 T Stoffels (3 800 - 900 ) E Khune (7 400 + 200 ) 7 600 S Mashele (-1 900 + 1 400 )  (500) -1 600 (2 marks) M Devnarain (10 600 - 800  - 800 ) One part correct  9 000 Correct total of Debtors' List 19 000  10 Inspection, reasonable or see 1.3.1 TOTAL MARKS 35 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 4 DBE/November 2013 NSC – Memorandum QUESTION 2 2.1 Choose a cost category from COLUMN B that matches a description in COLUMN A. Write only the letter (A–E) next to the question number (2.1.1–2.1.4). 2.1.1 E  (Direct material) 2.1.2 C  (Selling and distribution) 2.1.3 D  (Administration) 2.1.4 B  (Factory Overhead) 8 2.2 2.2.1 PRODUCTION COST STATEMENT FOR THE YEAR ENDED 31 AUGUST 2013 OR 450 000 (1 mark) – 135 000 (1 mark) OR 28 000 x (450 000 ÷ 40 000) 315 000  Direct material cost (28 000 x 11,25) Direct labour cost 985 600 PRIME COST Operation DMC+DLC, more than 985 600 1 300 600  Factory overhead cost 94 980 TOTAL MANUFACTURING COST 1 395 580  Operation PC+FOHC Work-in-process (1 September 2012) 12 420 1 408 000 Work-in-process (31 August 2013) (17 000)  Operation; Accept positive figure depending on above COST OF PRODUCTION OF FINISHED 1 391 000  8 GOODS (R65 x 21 400) FACTORY OVERHEAD COST Indirect material 7 360 Indirect labour 22 230 Depreciation of factory plant 8 630 Rent Expense 6 600 x 5 33 000 75 Water and Electricity 6 840 x / 25 20 520 Sundry factory expenses Operation  3 240 94 980 5 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 5 DBE/November 2013 NSC – Memorandum 2.2.2 The internal auditor is not satisfied with the direct labour cost for the year. Explain the problem relating to the direct labour cost and quote figures to support your explanation. Any valid response Good answer with figures = 3 marks; good answer without figures = 2 marks; part answer = 1 mark; incorrect = 0 Expected responses: • The workers are earning more through overtime (R563 200) than they are from normal time (R384 000). • The workers worked 1 200 hours normal time compared to 880 hours overtime / DLC is 71% of total costs. • Overtime accounts for 57% of the total direct labour cost. • Normal time is too low possible due to disruption, absenteeism or poor supervision (relevant figures required e.g. 49 weeks x 40 hours = 1 960). 3 Give TWO possible solutions to this problem. Any TWO valid and separate solutions Good answer = 2 marks; part answer = 1 mark; incorrect = 0 Expected responses for 2 marks:  • Set production targets that must be completed (time and motion studies). • Better supervision to ensure workers are on duty during normal working hours / rotate supervisors if necessary to prevent abuse. • Set limits on overtime hours and ensure foreman controls this. • Reconsider conditions of service e.g. minimum normal hours, overtime rate. • Employ more workers at normal rate for a full working day throughout the year, then discontinue overtime (cheaper to pay for normal time). • Anticipate disruption to normal time production (e.g. power cuts, strikes) – have contingency plans in place. Expected responses for 1 mark: • More normal time to be worked /Less overtime to be worked (same point) • Train workers 4 2.3 2.3.1 Calculate the number of units that Sally needed to produce in order to break even in 2013. Could be answered in equation form R96 450  = 12 056,2 or 12 056,3 or 12 056 or 12 057  R30 – R22  R8,00 (2 marks) Any one part correct, no R or % signs 4 2.3.2 Comment on the number of bags she is producing. Quote figures or financial indicators to support your answer. Refer to the break-even calculation in your answer. Comparison to BE calculation = 1 mark; Favourable/Unfavourable=1 mark; Figures = 1 mark. This is good as she will make a profit as production is (803 / 804) more than the break-even number of units. (12 860 produced; BEP 12 056 / 12 057) See 2.3.1 for figures – use consistently 3 TOTAL MARKS 35 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 6 DBE/November 2013 NSC – Memorandum QUESTION 3 3.1 Give ONE word/term for each of the descriptions by choosing a word/term from the list. Write only the word/term next to the question number (3.1.1–3.1.4). 3.1.1 Income  3.1.2 Current liability  3.1.3 Current asset  3.1.4 Expense  8 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 7 DBE/November 2013 NSC – Memorandum 3.2 SELATI LIMITED 3.2.1 INCOME STATEMENT FOR THE YEAR ENDED 30 JUNE 2013 Foreign items –1 Sales (13 120 000 – 702 000) Any one part correct 12 418 000 Cost of sales (8 200 000) Gross profit Operation 4 218 000 5 Other income Operation 66 220 (5200 + 10%) 2 marks Rent income (69 160– 5 720) Operation if any one part correct 63 440 Bad debts recovered 1 700 Provision for bad debts adjustment Operation if any one part correct 1 080 Gross operating profit Operation  4 284 220 11 Operating expenses (3 348 420) (4 980 + 2 020) 2 marks or nothing Salaries and wages (788 000+ 7 000 ) Any one part correct 795 000 Directors' fees 1 840 000 Audit fees (88 000 + 7 500) 95 500 Employer's contribution (81 000+ 1 610) 82 610 Bank charges (31 000 – 2 800) 28 200 Sundry expenses 89 730 Bad debts 12 100 May be combined as Repairs and maintenance (125 600 + 25 000) 150 600 Packing material 41 000 R26 500 Loss due to stock theft (40 000 – 32 000) Any one part correct 8 000 (6 marks) Any one part correct Trading stock deficit (1 534 000– 40 000–1 475 500) 18 500 Depreciation For depreciation details and balancing figure 187 180 28 Operating profit Operation 935 800 Interest income Must be correctly placed 27 000 Profit before interest expense Operation 962 800 Interest expense (2 800 + 120 000) Any one part correct and correctly placed  (122 800) Net profit before tax Operation 840 000 Income tax for the year Operation or if 30% of NPBT  (252 000) 10 Net profit after tax 588 000 54 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 8 DBE/November 2013 NSC – Memorandum 3.2.2 NOTE FOR RETAINED INCOME Balance at the beginning of the year 735 000 Net profit after tax 588 000 Dividends Operation; one part correct  (505 000) Interim 2 000 000 x 14 Operation; one part correct 280 000 Final 2 250 000 x 10c Operation; one part correct 225 000 Balance at the end of the year Operation 818 000 7 3.3 AUDIT REPORT As a shareholder, why would you be concerned about this audit report? Explain. State THREE points. Any THREE separate valid responses    Good answer with insight into the points mentioned in the audit report = 2 marks; Part answer which could repeat information from audit report = 1 mark; incorrect = 0 Expected responses for 2 marks: • This is a disclaimer/withheld/very bad report • This does not reflect well on the company • Proper corporate governance procedures have not been carried out • Proper internal control procedures have not been carried out • Potential investors (shareholders & lenders) will be deterred from investing in the company • The share price will be negatively affected (demand for the shares will decline) Expected responses for 1 mark: • The auditor has mentioned his concerns (‘qualified’ his opinion) • No approval for bonuses to directors • Insufficient documentation for sundry expenses 6 TOTAL MARKS 75 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 9 DBE/November 2013 NSC – Memorandum QUESTION 4 4.1 Refer to Information 8 regarding the special programmes that are published with the financial statements in the annual report. 4.1.1 Any valid response  Good answer with insight = 2 marks; Part answer which could include repetition from the question = 1 mark; incorrect = 0 Main benefit of crime prevention programme for the company: Expected responses for 2 marks: • This forms part of their corporate social investment/responsibility which is necessary as the company relies on the goodwill of the community (support/positive image/good publicity) in which they operate. • Creates a safer environment which encourages customers to visit the business / creates better working environment. • In accordance with the King Code. Expected responses for 1 mark (could be combined for 2 marks): • Corporate social investment/responsibility • Good image / publicity / increases confidence / goodwill in the company • Reduces theft or crime / Creates safer environment / Safeguard assets • Increases the profits of the company / Indirectly reduces insurance costs Main benefit of training programme for the company: Expected response for 2 marks: • Creates more competent employees who are better able to serve customers • Creates further goodwill (support/positive image/good publicity) for the company / lead to increased profits in future. Expected responses for 1 mark (could be combined for 2 marks): • Makes employees more efficient / Develop skills of staff (same point) • Serves customers better / Increases the profits of the company • Good image / publicity / increases confidence / goodwill in the company • Tax deductible 4 4.1.2 Apart from the points mentioned above, why would the directors want to mention these programmes in the annual report? Explain. Any valid response  Good answer = 2 marks; part answer = 1 mark; incorrect = 0 Any valid points not mentioned above e.g. King Code / goodwill / create a good impression of the company / directors will want the stakeholders to know about these issues / attract investment in the company (shareholders/lenders). 2 4.2 CASH FLOW STATEMENT FOR THE YEAR ENDED 28 FEBRUARY 2013 If no workings but figure correct, award full working marks to the figure if correct Method mark on answer is awarded for correct use of brackets/no brackets CASH EFFECTS OF OPERATING ACTIVITIES Income tax paid 360 000 – 9 000– 28 000 A  (323 000) 1 200 000 – 840 000 OR - 360 000 + 9 000 + 28 000 Dividends paid 210 000 + 280 000 OR – 210 000 – 280 000 B  (490 000) (455 000 – 175 000) CASH EFFECTS OF FINANCING ACTIVITIES Proceeds of shares issued 500 000+ 400 000 OR 4 700 000 – 3 800 000 C  900 000 Increase/Decrease in loans 2 800 000 – 2 100 000 D  (700 000) Net change in cash and cash equivalents Operation E  258 000 Cash and cash equivalents (1 March 2012) F  (180 000) Cash and cash equivalents (28 February 2013) 78 000 15 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 10 DBE/November 2013 NSC – Memorandum 4.3 Calculate the following financial indicators for the financial year ending 28 February 2013: 4.3.1 Percentage net profit after tax on sales 840 000  x 100 6 200 000  = 13,5% or 13,548% or 13,55%  Any one part correct if calculated as a % (% sign not necessary in this case) 3 4.3.2 Earnings per share 840 000  x 100 700 000  = 120 cents or R1,20  Any one part correct & shown as cents or Rands 3 4.3.3 Debt-equity ratio   2 100 000 : 5 285 000 = 0,4 : 1 or 0,397 : 1  (accept 0,39 : 1) Any one part correct & shown as a ratio x:1 3 4.3.4 Return on average shareholders' equity (ROSHE) 840 000  x 100 ½ (5 285 000 + 4 000 000 ) 4 642 500 (3 marks) = 18,1% or 18,09%  Any one part correct & shown as a % 5 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 11 DBE/November 2013 NSC – Memorandum 4.4 The directors are of the opinion that the operating efficiency of the company has improved. Quote and explain TWO financial indicators (with figures) to support their opinion. Financial indicators   Valid explanations (with figures)   Operating expenses on sales – decreased from 32% to 25% (improvement in control of expenses) Operating profit on sales – increased from 15,8% to 22% (improvement in efficiency / profit) Net profit after tax on sales – increased (see 4.3.1) from 11,3% to 13,5% (improvement in efficiency / profit) 4 4.5 The shareholders are happy with their return, earnings and dividends. Quote and explain THREE financial indicators (with figures) to support their opinion. Trends in financial indicators (with figures)    Valid explanations which go further than trends    Comment on shareholders' return: This has increased from 15,2% to 18,1%  (see 4.3.4) Good return/Greater than return on alternative investment opportunities  Comment on earnings: These have increased from 90 cents to 120 cents.  (see 4.3.2) This indicates a significant increase in the earnings (33%) / Will have a good influence on share price.  Comment on dividends: These have decreased from 82 cents to 65 cents.  The company is now retaining more of its earnings.  (see 4.3.2) 2012: (8/90 x 100) 9% retained 2013: (55/120 x 100) 46% retained 6 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 12 DBE/November 2013 NSC – Memorandum 4.6 New shares were issued at the beginning of the financial year at R9,00 each. As an existing shareholder, would you be satisfied with this issue price? Yes/No: Yes  Quote TWO financial indicators (with figures) to explain your opinion: Shares were sold for more than the NAV (900/755 or 900/667)  Shares were sold for more than the market value (900/840 or 900/820) 5 4.7 A large loan repayment was made. Comment on whether this was a good idea or not. Quote TWO financial indicators (with figures) to support your comment. Note that the comment and the explanation of financial indicators could be combined into one statement. Expected response for comment:   Not a good idea. There is positive gearing / lower financial risk. Expected response for financial indicators (with figures): ROTCE is 19,3% (interest rate is 8%) Debt-equity ratio is now 0,4 : 1 (from 0,7 : 1) 4 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 13 DBE/November 2013 NSC – Memorandum 4.8 Apart from the dividends and the loan, what other major decisions by the directors are reflected in the Cash Flow Statement? State TWO major decisions and quote the relevant figures. Also explain how EACH of these decisions would benefit the company in the future. Decision 1 (with figures) Explanation of benefit to company Issue of additional shares  Improves the cash flow in the (R900 000) company / Eliminated the bank This must be mentioned as it is the most overdraft / Reduced the loan / To buy significant additional assets to improve efficiency  Decision 2 (with figures) Explanation of benefit to company Fixed assets purchased  Improves the operating efficiency / (R400 000 or R314 000 ) leads to future gains  OR Fixed assets sold (R86 000) OR Improves cash flow or could improve efficiency 6 TOTAL MARKS 60 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 14 DBE/November 2013 NSC – Memorandum QUESTION 5 5.1 Complete the following sentences by filling in the missing word(s). Write only the word(s) next to the question number (5.1.1–5.1.3). 5.1.1 The main purpose of preparing the Cash Budget is ... Expected responses: Any valid answer with future implications  To plan To predict cash flows/determine receipts & payments for the future To control cash Note: Do not accept reference to Income and Expenditure 2 5.1.2 ONE item in the Cash Budget that will not be reflected in a Projected Income Statement is ... Any valid answer  Loan / Assets / Payments to creditors / Drawings Receipts from debtors / Fixed deposits / Capital / Dividends 2 5.1.3 ONE item that will appear in a Projected Income Statement but not in a Cash Budget is ... Any valid answer  Depreciation / Bad debts / Discount received and allowed Profit/loss on sale of asset 2 5.2 Calculate the missing figures in the Debtors' Collection Schedule and the Cash Budget indicated by A to H: CALCULATION ANSWER A 40% x 300 000 All or nothing 120 000 36 000 - 1 800 B (20% x 180 000) x 95% Any one part correct  34 200 OR (57 000 / 300 000 x 180 000): 2 marks C If R63 000 more than A+B Operation  217 200 350 000 x 40% D OR 210 000 (1 mark) /60 x 40 (1 mark) Any one part correct  140 000 OR 350 000 (1 mark) – 210 000 (1 mark) (500 000 x 100/200) E Any one part correct 200 000 250 000 x 80% (400 000 – 40 000) x (12% ÷12) F 360 000 x 1% Any one part correct  3 600 OR 43 200 (1 mark) ÷ 12 (1 mark) (R1 300 x 1,06: 2 marks) (6 x R5 512: 3 marks) 6 x R1 378 x 4 weeks OR R22 048 x 6 ÷ 4 G Any one part correct  R33 072 1 mark 1 mark 1 mark OR R22 048 + 11 024 1 mark 2 marks 6 758 x 100÷109 H OR 6 758 ÷ 1,09 Any one part correct 6 200 OR 6 758 – 558 (6 758 x 9 ÷ 109) 22 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 15 DBE/November 2013 NSC – Memorandum 5.3 Explain what you would say to Peter about each of the following items at the end of November, and give ONE point of advice in EACH case: EXPLANATION ADVICE       Overspent/ Check private calls/ Under-budgeted/ Budget more realistically for Telephone Not well controlled business calls Negative variance Well budgeted/ Stick to the budget/ Sundry Well controlled Maintain this in future/Keep it up expenses Nil variance / Same Try to reduce in future Received less than budgeted/ Investigate payment by tenant/ Not well controlled Keep property occupied Rent income Negative variance Employ debt collector Budget more realistically 6 5.4 In order to increase sales and the number of customers, Peter intends to advertise that credit limits for all credit customers will be increased to R35 000 and that new customers are welcome to open accounts during April. Give THREE points of advice to Peter in this regard. Any THREE separate valid points    Good answer = 2 marks; part answer = 1 mark Expected responses for 2 marks: • Do not sell more on credit as this will worsen the overdraft (60% of his existing sales are already on credit, and 50% settle after 30 days). • He must screen debtors properly (e.g. pay slip / credit reference), not simply allow them to open accounts without checking ability to pay (contravention of consumer legislation). • Only increase credit limits of customers who settle their debts promptly (preferably within 30 days). • He must improve the rate of collections from debtors by offering discount (50% of debtors settle after 30 days). • He must improve the rate of collections from debtors by charging interest (50% of debtors settle after 30 days). • He must provide for additional administration costs (e.g. salaries of clerk, bad debts) to control the debtors. • He must introduce more working capital into the business to finance the stock sold on credit (as the debtors will pay later). Expected responses for 1 mark: • Improve debtors collections • Take precautions to prevent slow payers • Provide for bad debts 6 TOTAL MARKS 40 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 16 DBE/November 2013 NSC – Memorandum QUESTION 6 6.1 FIXED ASSETS 6.1.1 Calculate the missing figures indicated by A, B and C in the Fixed Asset Note: CALCULATION ANSWER All or nothing A R3 000 000 – R2 100 000  R900 000 B R112 000  + R54 000  Any one part correct 20% x (780 000 – 220 000) 360 000 x 20% x 9/12  R166 000 Operation C If B + 220 000  R386 000 9 6.1.2 LEDGER OF ULWAZI LTD ASSET DISPOSAL ACCOUNT One part of Accu depr on workings 2013 2013 Jan 31 Equipment  18 000 Jan 31 equipment correct 6 750+ 3 750 10 500 Bank   800 Loss on Operation disposal of  6 700 asset  May be a profit, depending 18 000 on figures 18 000 11 6.1.3 You are the internal auditor. State TWO concerns that you would voice in respect of the fixed assets with the board of directors. Explain in EACH case why you are concerned. Reason must correspond to the concern CONCERN Any TWO   REASON Any TWO   Land and buildings were sold at Should have been sold at its current cost price market value Unreasonable purchase price for a A loss of R6 700 has been incurred / computer (R800) taken by CEO he should be charged the fair market value / unethical Nepotism shown by the CEO Land and buildings were not sold at its current market value / was not advertised to public / Deal has been finalised with his wife / Corruption Land and buildings being used to Land and building normally solve a cash flow problem appreciate in value (loss of possible profits) Vehicles were bought (R360 000) These might not be necessary 4 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 17 DBE/November 2013 NSC – Memorandum 6.2 6.2.1 Value of closing stock according to the FIFO method # R87 600 730  x R120  If 970 – # One part correct Operation  240  x R100  R24 000 OR (Choose only one method to mark) Operation 48 000 + 503 100 – 18 000 – 6 000 – 415 500 R111 600 1 mark 1 mark 1 mark 1 mark 2 marks 7 6.2.2 Calculation of mark-up percentage (%) achieved on cost 504 000 – 415 500 (2 or nothing)  Any one part correct 88 500 x 100 = 21,3% or 21,29%  R415 500  Calculation of stock holding period (use average stock in your calculation) See 6.2.1 must be added to 48 000 to get the method mark Award 2 marks for average stock if correct (see 6.2.1) even if as denominator. 79 800 ½ (R48 000 + R111 600 ) x 365 R415 500 1 = 69,35 days or 70 days or 2,3 months  Operation, one part correct, shown in days or months 8 6.2.3 The business aims at a mark-up of 30% on cost. As the internal auditor, what would you investigate? Explain. State TWO points. See 6.2.2 above. Points below will depend on MU% calculated. Any TWO   Good answer = 2 marks; part answer = 1 mark • Excessive trade discounts offered to customers • Incorrect mark-up calculations • Too many items sold at seasonal sales (discounts) • Excessive stock on hand leading to clearance sales • Theft of cash / stock • Counter competitors’ prices OR: • Will have to increase selling (marked) prices in future • Buy in bulk • Cheaper supplier 4 6.2.4 The stock holding period for 2012 was 30 days. Should Mohammed be satisfied with the stock holding period for 2013? Explain. See 6.2.2 above. Points below will depend on stock period calculated. Yes/No:  Explanation:  Good answer = 2 marks; part answer = 1 mark Explanation for NO: • The stock holding period has increased (from 30 days to 70 days). • This is not good as money is tied up in stock • Stock might not be sold if it deteriorates • More chance of stock theft Explanation for YES: • Stock levels too low in 2012 and now less likely to run out of stock • Better prices through bulk purchases. 3 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting 18 DBE/November 2013 NSC – Memorandum 6.3 Identify ONE problem with regard to each shop, quoting figures in identifying each problem. In EACH case, advise Sizwe on how to solve the problem. SHOP 1: THANDEKA Problem identified Printer being overused (70 000 copies). (with figures) Printer is old and is fully written off (R1,00). Problem Maintenance becomes expensive (R4 000). Figure R18 000 is missing from fees collected. Advice  Printer needs to be replaced. Needs to investigate reason for R18 000 shortage in fee income (disciplinary action might be necessary). Division of duties to prevent fraud. SHOP 2: DLUDLU Problem identified Ink and consumable items used (R19 500) is high. (with figures) High number of spoilt copies (5 870). Problem Figure Advice  Dludlu needs training in the use of the printer to minimise spoilt copies and reduce cost of ink and consumables. Return printer to supplier if warranty still in operation. Repair the printer. SHOP 3: SIPHO Problem identified Low number of copies made. Not meeting capacity. (with figures) New printer underutilised (20 000/50 000). Problem Business is making very small profit (R2 400 or Figure R1 234). Advice  Consider closing down this shop (after investigating why there is a low number of copies made, e.g. manager might be lazy, shop might be situated in poor location) Advertise to increase sales. Move the printer to Shop 1 / Swop printers. 9 TOTAL MARKS 55 TOTAL: 300 Copyright reserved Please turn over