Accounting Grade 11 P2 Eastern Cape November 2023 Memo (Eng)

NATIONAL SENIOR CERTIFICATE GRADE 11 NOVEMBER 2023 ACCOUNTING P2 MARKING GUIDELINE MARKS: 150 MARKING PRINCIPLES: 1. Unless otherwise stated in the marking guidelines, 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. Penalties for placement or poor presentation (e.g. details) are applied only if the candidate is earning marks on the figures for that item. 3. Full marks for correct answer. If answer incorrect, mark the workings provided. 4. 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). NOTE: If figures are stipulated in the marking guidelines for components of workings, these do not carry the method mark for final answer as well. 5. 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. 6. Where indicated, part-marks may be awarded to differentiate between differing qualities of answers from candidates. 7. Where penalties are applied, the marks for that section of the question cannot be a final negative. 8. Where method marks are awarded for operation, the marker must inspect the reasonableness of the answer. 9. Operation means ‘check operation’. ‘One part correct’ means operation and one part correct. NOTE: Check operation must be +, -, x, ÷, or per marking guideline. 10. In calculations, do not award marks for workings if numerator and denominator are swapped – this also applies to ratios. 11. In awarding method marks, ensure that candidates do not get full marks for any item that is incorrect at least in part. Indicate with a . 12. Be aware of candidates who provide valid alternatives beyond the marking guideline. Note that one comment could contain different aspects. 13. Codes: f = foreign item; p = placement/presentation. This marking guideline consist of 9 pages.

2 ACCOUNTING P2 (EC/NOVEMBER 2023) QUESTION 1: RECONCILIATIONS 1.1.1 CASH RECEIPTS JOURNAL DETAILS OF SUNDRY ACCOUNT AMOUNT TOTAL b/f 117 600 Stationery  (7 530 – 3750) 3 780  Rent income 9 000  Debtors control  / S. Deley 4 160  134 540 6 CASH PAYMENTS JOURNAL DETAILS OF SUNDRY ACCOUNT AMOUNT TOTAL b/f 126 200 Sales  (27 600 – 20 000) 7 600  Rates and taxes 2 360  Drawings  1 340  Insurance 1 860  Bank charges (270 + 230) no part marks 500  139 860 8 1.1.2 Calculate the correct Bank Account Balance. see CRJ* see CPJ* – 7 440  + 134 540  – 139 860  = – 12 760  one part correct * must include the provisional totals for each journal. Accept alternative arrangement for calculations; accept signs reversed; ignore sign for total, penalise transfer to 1.1.3. 4 1.1.3 BANK RECONCILIATION STATEMENT ON 31 AUGUST 2023 DEBIT CREDIT Could be CR; totals Balance as per statement 25 320  must be same below Outstanding deposit 22 750  Outstanding EFTs: No. 816 3 370  No. 817 9 180  Credit error on statement 2 360  Balance as per bank account 12 760  See 1.1.2 37 870  37 870 7 for both totals Copyright reserved Please turn over

(EC/NOVEMBER 2023) ACCOUNTING P2 3 1.1.4 Explain any TWO different internal control measures that Flavo can implement based on a problem you identified in the information provided. PROBLEM IDENTIFIED INTERNAL CONTROL MEASURE ONE problem  TWO suggestions   • Division of duties / duties are shared. Deposits are done late / • Employ a security company to assist Cash is kept for long periods / • Bank notification (e.g. SMS) Money is missing / Poor recording – making • Authorisation / supervision mistakes. • Training of bookkeeper • Policy on daily depositing 3 1.2 CREDITORS RECONCILIATION Reconciling the Creditors Ledger account with the Statement CREDITOR LEDGER STATEMENT FROM No. ACCOUNT OF NANDU SUPPLIERS NANDU SUPPLIERS Balance 40 100 21 020 A – 8 800  B – 3 480  – 1 740 one mark – 1 740 one mark C + 2 700  D + 480  – 480  see CL E – 1 240  F + 6 300  TOTAL 28 300 * 28 300 * one part correct; must include the opening balance 12 Q1 40 Copyright reserved Please turn over

4 ACCOUNTING P2 (EC/NOVEMBER 2023) QUESTION 2: COST ACCOUNTING 2.1.1 Calculate: Direct material cost WORKINGS ANSWER 56 700  + 522 000  – 11 200  – 62 300  505 200  one part correct Accept alternative arrangement for calculations, such as ledger account. 5 Direct labour cost WORKINGS ANSWER 6 x 1 640 x R40 = 393 600  one part correct 525 x R64  = 33 600  if x 525 466 560  393 600 x 10% = 39 360  if x 10% one part correct OR [3 926 + 35 334] one mark 7 2.1.2 FACTORY OVERHEAD COST TOTAL BROUGHT FORWARD 321 580 Indirect labour 64 800 x 65% + 42 120  Rent expense 88 200 – 126 000 – 37 800 * Water and electricity 41 000 – 28 700  + 12 300 * TOTAL one part correct, must include total b/f 338 200  * one part correct; Ignore signs, penalise final total. 8 2.1.3 GENERAL LEDGER OF WESTERN MANUFACTURERS WORK-IN-PROGRESS STOCK ACCOUNT 2022 71 300 2023 28 Finished goods stock  1 333 500 Mar 1 Balance b/d  Feb Balancing figure  2023 505 200 47 760 Feb 28 Direct material cost Balance c/d   Direct labour cost 466 560  Factory overhead cost 338 200  see transfer of amount from above; -1 for no details 1 381 260 1 381 260 2023 Mar 1 Balance b/d 47 760 7 Copyright reserved Please turn over

(EC/NOVEMBER 2023) ACCOUNTING P2 5 2.2 NELSON’S FACTORY 2.2.1 Calculate the break-even point for the year ended 30 June 2023. 575 000  = 4 600 units  one part correct 535  – 410  125 two marks 4 2.2.2 Explain whether Nelson should be satisfied with the level of production achieved for this financial year. Quote figures. Comment on production and BEP  figures (production and BEP)  The business produced 5 000 units which is 400 more than the BEP / Nelson should be satisfied as he is making a profit on 400 units. 3 2.2.3 Identify TWO costs that should be of a concern to Nelson. Quote figures. In EACH case, provide a possible solution to address the concern. COST IDENTIFIED   SOLUTION TO ADDRESS THE CONCERN (with figures)     Direct material cost increased Buy cheaper material; look for local from R155 to R180 / 16,1% suppliers / train workers to reduce wastage Selling and distribution Assess the impact of advertising; advertise increased from R50 to R66 / to a select market; charge for delivery; pay 32% commission for increased sales 6 Q2 40 Copyright reserved Please turn over

6 ACCOUNTING P2 (EC/NOVEMBER 2023) QUESTION 3: BUDGETING 3.1 DEBTORS COLLECTION SCHEDULE Month Credit sales OCTOBER NOVEMBER DECEMBER SEPTEMBER 399 000 179 550 47 880 OCTOBER 405 300 154 014 182 385  48 636  NOVEMBER 388 500 147 630  174 825 DECEMBER 378 000 143 640 TOTAL 8 3.2 Calculate: (i) Cash sales for November 2023 WORKINGS ANSWER 647 500 x 40% OR 388 500 x 40/60 259 000  TWO or nothing 2 Calculate: (ii) Rent income for December 2023 WORKINGS ANSWER 10 200 x 109%  OR 10 200 + 918 one mark 11 118  If x 109% or +918 2 Calculate: (iii) Loan that will be received in November 2023 WORKINGS ANSWER 62 400 two marks 5 200  x 12  480 000  one part correct 13%  4 Calculate: (iv) Payment to creditors in December 2023. WORKINGS ANSWER 647 500  x [100/175]  370 000  one part correct 3 Calculate: (v) Insurance for November 2023 WORKINGS ANSWER 3 975  x [100/106]  3 750  one part correct 3 Calculate: (vi) Drawings in December 2023 WORKINGS ANSWER 7 500 x 75% 5 625  TWO or nothing 2 Copyright reserved Please turn over

(EC/NOVEMBER 2023) ACCOUNTING P2 7 3.3 Calculate: The % increase in salaries of office workers. WORKINGS ANSWER 2 700 two marks 70 200  – 67 500  x 100 4%  67 500  one part correct 4 Explain TWO points why they should be satisfied with the increase they will receive in December. Two reasons   • Lucky to be employed / state of the economy; • At least it is an increase – they can afford to maintain standard of living • Close to inflation rate • Managers only got a 2,5% increase. 2 3.4.1 Calculate: Total cost relating to the purchase of the vehicle WORKINGS ANSWER 12 650 x 36 months 531 400  455 400  + 76 000  one part correct 4 3.4.2 Identify TWO additional items that must be included on the budget once the vehicle is purchased. Any TWO of:   Maintenance / service of vehicle / petrol or fuel / driver salary / insurance on vehicle 2 3.4.3 Besides the possibility of increased sales, explain TWO other advantages of the business purchasing the vehicle. TWO advantages   part-marks for incomplete / unclear answers • The business would own an asset; increased value of business; • Available at all times; • Delivery routes may not be restricted; • Can determine terms and conditions for customers 4 Q3 40 Copyright reserved Please turn over

8 ACCOUNTING P2 (EC/NOVEMBER 2023) QUESTION 4: VAT AND FIXED ASSETS 4.1.1 Provide ONE explanation why some goods are classified as zero-rated. ONE valid explanation  part marks for unclear / incomplete response The government wants all citizens to be able to afford these goods; These goods are deemed to be necessary goods that are accessible to the poor; The government can place a VAT rate on these goods in the future if additional government funding is needed. 2 4.1.2 VAT CALCULATIONS: * no part marks for workings WORKINGS ANSWER (i) 98 900 – 86 000 OR 86 000 x 15% OR 98 900 x 15/115 12 900  (ii) 98 000 x 15% 14 700  (iii) 62 790 x 15/115 8 190  (iv) 11 910 x 115/15 91 310  8 4.2 FIXED ASSETS 4.2.1 Provide TWO reasons why Sydney wanted to replace some assets. TWO valid reasons   part marks for unclear / incomplete response • They are old / out-dated / obsolete • No longer productive or productivity has decreased • Require more maintenance – becoming expensive to maintain • Better models / brands / quality products are now available • Wants to give the business a facelift – change the image 4 4.2.2 Explain why Sydney wanted to record the computers separately. ONE valid reason  part marks for unclear / incomplete response • Technological items have a shorter lifespan • Software is being developed at a faster rate – need to keep up • Loses replacement value – would not be able to dispose or trade-in • Other furniture is durable, not subject to changes, always useful if maintained regularly, do not need to keep up to current times. 2 Copyright reserved Please turn over

(EC/NOVEMBER 2023) ACCOUNTING P2 9 4.2.3 GENERAL LEDGER OF SS CONSULTANTS COMPUTERS B8 2022 2022 Mar 1 Balance b/d 86 000  Jul 31 Asset disposal  51 600  2023 Bank 61 500  Feb Balance c/d 95 900  one part correct 147 500 147 500  2023 Operation Mar 1 Balance b/d 95 900 7 ASSET DISPOSAL ACCOUNT N9 2022 2022 Accumulated depreciation 28 595 Jul 31 Computers 51 600 ✓ Jul 31 on computers # Bank 9 000  * Loss on sale of assets 14 005  * could be a profit Balancing figure 51 600 51 600 # 23 220 one + 5 375 two marks [51 600 x 25% x 5/12] 7 Q4 30 TOTAL: 150 Copyright reserved Please turn over