Accounting Grade 12 P2 NSC June 2021 Question Paper (Eng)

Downloaded from hlayiso.com SENIOR CERTIFICATE EXAMINATIONS/ NATIONAL SENIOR CERTIFICATE EXAMINATIONS ACCOUNTING P2 2021 MARKS: 150 TIME: 2 hours This question paper consists of 13 pages, a formula sheet and a 9-page answer book. Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 2 DBE/2021 SC/NSC INSTRUCTIONS AND INFORMATION Read the following instructions carefully and follow them precisely. 1. Answer ALL questions. 2. A special ANSWER BOOK is provided in which to answer ALL questions. 3. Show ALL workings to earn part-marks. 4. You may use a non-programmable calculator. 5. You may use a dark pencil or blue/black ink to answer questions. 6. Where applicable, show ALL calculations to ONE decimal point. 7. If you choose to do so, you may use the Financial Indicator Formula Sheet attached at the end of this question paper. The use of this formula sheet is NOT compulsory. 8. Write neatly and legibly. 9. Use the information in the table below as a guide when answering the question paper. Try NOT to deviate from it. QUESTION TOPIC MARKS MINUTES 1 VAT and Creditors' Reconciliation 35 25 2 Cost Accounting 35 25 3 Budgeting 45 40 4 Stock valuation 35 30 TOTAL 150 120 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 3 DBE/2021 SC/NSC QUESTION 1: VALUE-ADDED TAX (VAT) AND CREDITORS' RECONCILIATION (35 marks; 25 minutes) 1.1 VALUE-ADDED TAX (VAT) Hilda Groceries is registered for VAT. The standard VAT rate is 15% and is applied on most products. REQUIRED: 1.1.1 Implementation of VAT:  Explain why the government implemented VAT in South Africa. State ONE point. (2)  Explain why some products are zero-rated products. State ONE point. (2) 1.1.2 Calculate the amount payable to SARS in respect of VAT for the two months ended 30 April 2021. (11) INFORMATION: A. Balance due to SARS on 1 April 2021, R9 450 B. Transactions for April 2021: AMOUNT VAT AMOUNT EXCLUDING AMOUNT INCLUDING VAT VAT R R R Total sales 412 000 ? 473 800 Purchases of trading stock 230 000 ? Discount allowed to debtors 1 890 Goods returned by customers ? 19 320 Bad debts recovered 1 140 Drawings of trading stock by 1 380 the owner Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 4 DBE/2021 SC/NSC 1.2 KHAYA STORES Khaya Stores is owned by Peter Sithole. The business buys goods on credit from PN Suppliers. The business received a statement of account for February 2021. REQUIRED: 1.2.1 Refer to Information A, B and C. Use the table that is provided. Indicate the changes to the Creditors' Ledger Account in the books of Khaya Stores and the statement received from PN Suppliers to take into account the errors and omissions on 28 February 2021. Indicate + or – for each amount. (12) 1.2.2 Refer to Information D.  State TWO benefits of using electronic funds transfers (EFTs) for payments to creditors. (2)  The internal auditor feels that this incident of fraud should never have occurred in this business. - Explain why he feels this way. (2) - Explain how this could have been prevented. State TWO points. (4) INFORMATION: A. Creditors' Ledger of Khaya Stores PN SUPPLIERS (CL8) DATE DETAILS DEBIT CREDIT BALANCE R R R 2021 1 Balance 86 900 Feb. 5 Invoice 353 18 800 105 700 7 Debit note 72 600 105 100 13 EFT 428 22 800 82 300 Discount 1 140 81 160 14 Invoice A417 6 100 87 260 16 Invoice 390 11 800 99 060 23 Invoice 401 8 900 107 960 24 EFT 676 12 000 95 960 25 Journal voucher 221 2 660 93 300 27 Invoice 556 7 700 101 000 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 5 DBE/2021 SC/NSC B. Statement of account received from PN Suppliers Khaya Stores 228 Rhino Street 25 February 2021 DATE DETAILS DEBIT CREDIT BALANCE R R R 2021 1 Balance 86 900 Feb. 5 Invoice 353 10 800 97 700 7 Credit note 109 600 98 300 14 Receipt 632 22 800 75 500 16 Invoice 390 12 980 88 480 23 Invoice 401 8 900 97 380 24 Receipt 961 12 000 85 380 C. Errors, omissions and other information: (i) Invoice 353 on 5 February 2021 was correct according to the statement. (ii) PN Suppliers made an error in recording the goods returned on 7 February 2021. (iii) Khaya Stores entered a discount with the EFT payment on 13 February 2021. PN Suppliers informed the business that they do not qualify for this discount. (iv) Invoice A417 in the Creditors' Ledger Account of PN Suppliers was for goods purchased from LM Suppliers. (v) The trade discount on Invoice 390 was not deducted by PN Suppliers. (vi) The bookkeeper transferred a debit balance from the Debtors' Ledger Account of PN Suppliers (Journal voucher 221) to their account in the Creditors' Ledger. (vii) The statement shows entries up to 24 February 2021 only. D. During an internal audit, the auditor noticed the following account in the Creditors' Ledger of Khaya Stores: EXCESS TRADERS CL24 DATE DETAILS DEBIT CREDIT BALANCE 2021 20 Invoice 11 334 R120 000 R120 000 Feb. 22 EFT R120 000 R0 It was discovered that an EFT payment of R120 000 was made to Frank Adams, the sole owner of Excess Traders. Further investigation by the internal auditor revealed that this business is not operational and that Frank Adams is a close relative of the accountant of Khaya Stores. 35 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 6 DBE/2021 SC/NSC QUESTION 2: COST ACCOUNTING (35 marks; 25 minutes) 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 numbers (2.1.1 to 2.1.3) in the ANSWER BOOK, e.g. 2.1.4 F. COLUMN A COLUMN B 2.1.1 Commission to salespersons A factory overhead cost 2.1.2 Wages of factory maintenance staff B administration cost 2.1.3 Office stationery expenses C direct labour cost D direct material cost E selling and distribution cost (3 x 1) (3) 2.2 MEISIES OUTFITTERS The business manufactures clothing products. The owner is Minnie Zitha. The information relates to school dresses which is one of the products they manufacture. Dresses are manufactured according to orders received and there is no work-in-progress. The financial year ended on 30 April 2021. REQUIRED: 2.2.1 Refer to Information D. Complete the Factory Overhead Cost Note for the school dresses. (10) 2.2.2 Calculate the total cost of production of school dresses produced. (4) 2.2.3 Minnie is concerned about wastage of fabric in the dressmaking section. Calculate the cost of this wastage to the business. (5) 2.2.4 The internal auditor expressed concern about the direct labour cost for the school dresses.  Explain the problem that is of concern to the auditor. Quote figures. (3)  State TWO possible causes of this problem. (2) 2.2.5 Provide a calculation to confirm that the break-even point for the current financial year is 17 000 units. (3) 2.2.6 Comment on the level of production achieved and the break-even point calculated above. Quote figures. (2) 2.2.7 Calculate the extra profit that would be earned if an additional 500 dresses are made and sold. Assume that all costs are unchanged. (3) Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 7 DBE/2021 SC/NSC INFORMATION: A. Raw material stock (fabric used to make the dresses): Fabric is issued to the factory using the weighted-average method. UNITS COST TOTAL (metres) per metre COST Stock of fabric on 1 May 2020 9 000 R14,20 R127 800 Fabric purchased during the year 33 000 R17,00 R561 000 42 000 R688 800 Fabric issued to the factory 29 000 R16,40 R475 600 B. Production and sales:  Manufacturing one dress requires 1,6 metres of fabric.  17 800 dresses were produced and sold during the financial year at R75 per dress. C. Direct labour cost for the year: HOURS WORKERS PER RATE TOTAL WORKER Basic wage (normal time)* 8 1 250 R25 R250 000 Total overtime worked 8 720 R45 R259 200 Total employer's contributions R26 250 TOTAL 1 970 R535 450 *Normal time comprises a 5-day week of 8 hours per day. The factory operates for 46 weeks each year. D. Factory overhead costs: The following costs were extracted from the records on 30 April 2021: Factory rent expense R122 400 Water and electricity 81 600 Insurance on factory equipment 20 720 Salary of the dressmaking supervisor 76 960 Delivery expenses 36 800 Wages of cleaners 155 760 Depreciation: dressmaking machines 30 300 Sundry factory expenses (dressmaking section) 10 670 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 8 DBE/2021 SC/NSC  Factory rent is split according to floor space occupied. The dress- making section occupies 320 m2 of the total factory space of 1 280 m2.  15% of the total water and electricity account must be allocated to the dressmaking section.  Insurance on factory equipment was paid up to 30 June 2021. Dress- making equipment comprises ⅓ of the total factory equipment.  Only one of the six cleaners, Susan, was allocated to the dressmaking section. Susan earns 10% less than the other five cleaners. E. Additional information relating to the dressmaking section:  Total variable costs amounted to R1 094 700 (R61,50 per unit)  Fixed costs, comprising factory overhead costs and administration costs, totalled R229 500 35 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 9 DBE/2021 SC/NSC QUESTION 3: BUDGETING (45 marks; 40 minutes) 3.1 Insert the relevant amount(s) for EACH transaction below into the appropriate columns for the following Cash Budget and Projected Income Statement for July 2021. Example: Monthly telephone costs are expected to be R4 200. PROJECTED INCOME CASH BUDGET FOR JULY NO. STATEMENT FOR JULY RECEIPT PAYMENT INCOME EXPENSE e.g. 4 200 4 200 (8) TRANSACTIONS FOR JULY 2021: 3.1.1 A three-month advertising contract for R6 000 will be paid on 1 July 2021. R2 000 of this amount relates to the next financial year. 3.1.2 On 1 July 2021, R45 000 will be invested in a fixed deposit at 8% interest p.a. Interest is not capitalised and is received at the end of each month. 3.1.3 Budgeted cash sales, R23 200 (cost of sales; R16 000). 3.2 ANOKHI (PTY) LTD The business sells electrical appliances. The financial year ends on 30 April. Kayla Bester is the sole shareholder and CEO of the business. REQUIRED: 3.2.1 Complete the Creditors' Payment Schedule for the budget period ending 31 July 2021. (9) 3.2.2 Calculate the amounts for (a) to (d) in the Cash Budget. (16) 3.2.3 Kayla extracted the following actual and budgeted figures for May 2021: BUDGETED ACTUAL Total sales R882 000 R705 600 Cash from debtors 522 828 402 600 Advertising 35 280 35 280 Delivery expenses (ABC Deliveries) 57 330 51 200 Comment and quote figures on the:  Effectiveness of the advertising  Control over delivery expenses Quote figures in EACH case. (6) Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 10 DBE/2021 SC/NSC 3.2.4 Kayla decided that the business will purchase a delivery vehicle on 1 June 2021.  State TWO benefits of this decision. (2)  Apart from the items reflected in the Cash Budget (Information F), list FOUR other items that Kayla should include in the budget. (4) INFORMATION: A. Total sales: ACTUAL SALES BUDGETED SALES APRIL 2021 MAY 2021 JUNE 2021 JULY 2021 R878 400 R882 000 R918 000 R936 000 B. Credit sales comprise 60% of total sales. C. Goods are sold at a mark-up of 80% on cost. D. The business maintains a fixed-stock base level. Stock sold in a month is replaced in the same month. The cash purchases are 65% of total purchases. E. Creditors are paid according to the following trend:  40% – settled in the month of purchase to earn 5% discount  50% – settled in the month following the purchase month  10% – settled in the second month after the purchase month F. Extract: Cash Budget for the three months ended 30 July 2021 MAY 2021 JUNE 2021 JULY 2021 R R R Receipts Cash sales 352 800 367 200 374 400 Cash from debtors 522 828 535 140 548 640 Rent income 15 500 15 500 (a) Loan: Jane Investments 0 (b) 0 Payments Cash purchases 318 500 331 500 338 000 Payments to creditors 167 020 170 660 ? Salaries of sales assistants 41 000 41 000 (c) Directors fees (d) 98 880 98 880 Advertising 35 280 36 720 37 440 Interest on loan 0 3 150 3 150 Delivery expenses 57 330 59 670 0 (ABC Deliveries) Delivery vehicle deposit 140 000 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 11 DBE/2021 SC/NSC (a) Rent income is expected to increase by 9% p.a. from 1 July 2021. (b) The business has negotiated a loan which will be received on 1 June 2021. Interest at 13,5% p.a. is payable at the end of each month, commencing from 30 June 2021. (c) The business employed five sales assistants in May and June on the same salary scale. Three of them will receive an annual bonus of 75% of their earnings in July 2021. A part-time sales assistant will be employed during July 2021 and will earn 50% of the monthly amount applicable to the others. (d) Kayla earns directors' fees of R720 000 for the year. The company also employed another director, Martin, for the entire year. Martin will receive an increase of 8% p.a. on his directors' fees from 1 June 2021. 45 Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 12 DBE/2021 SC/NSC QUESTION 4: STOCK VALUATION (35 marks; 30 minutes) 4.1 Choose the correct word(s) from those given in brackets. Write only the word(s) next to the question numbers (4.1.1 to 4.1.4) in the ANSWER BOOK. 4.1.1 The (specific identification/first-in first-out) method assumes that the closing stock is valued at the most recent batches purchased. 4.1.2 The (periodic/perpetual) system requires a year-end stock count to be able to calculate cost of sales. 4.1.3 The (weighted-average/first-in first-out) method is suitable for similar goods that are bought in bulk. 4.1.4 The (periodic/perpetual) system requires that all products are scanned at the point of sale. (4) 4.2 GWEN BOUTIQUE The information relates to ALUZE bags for the financial year ended 28 February 2021. The business uses the first-in first-out method to determine the value of these bags. The periodic inventory system is in use. REQUIRED: 4.2.1 Calculate the following for the year ended 28 February 2021:  Value of the closing stock (5)  Cost of sales (5) 4.2.2 Stockholding period:  Calculate the average stockholding period (in days). (5)  Explain whether Gwen should be satisfied with this figure, or not. State TWO points. NOTE: The average stockholding period on 29 February 2020 was 52 days. (4) 4.3 PROBLEM-SOLVING Refer to Information D. Gwen Boutique also sells jackets and jerseys. Gwen has provided the information and requested advice. Identify TWO problems in EACH product for 2021. In each case, give ONE piece of advice to address the problem identified. (12) Copyright reserved Please turn over

Downloaded from hlayiso.com Accounting/P2 13 DBE/2021 SC/NSC INFORMATION: A. Stock balances: TOTAL VALUE DATE UNITS (including carriage) 1 March 2020 420 R68 120 28 February 2021 380 ? B. Purchases and returns for the year: TOTAL CARRIAGE TOTAL COST UNIT DATE UNITS PURCHASE COST (including COST AMOUNT (per bag) carriage) 30 Jun. 2020 500 R155 R77 500 R12 R83 500 31 Oct. 2020 750 R160 R120 000 R13 R129 750 15 Feb. 2021 320 R170 R54 400 R15 R59 200 TOTAL 1 570 R272 450 Returns 20 R3 700 C. Sales: Total sales amounted to R393 750 (1 590 bags). D. Problem-solving: JACKETS JERSEYS 2021 2020 2021 2020 Units: Opening stock 407 120 218 200 Units: Purchases 800 800 1 800 2 200 Units sold (gross) 550 500 1 970 2 260 All sales are for cash. Units returned by customers 0 0 90 78 Units: Closing stock 615 407 138 218 Stock turnover rate 0,9 1,9 10,6 10,4 Mark-up % achieved 75% 50% 25% 25% R R R R Cost price per item 360,00 360,00 170,00 160,00 Selling price 630,00 540,00 212,50 200,00 Income from sales 346 500 268 920 349 500 436 400 deposited in the bank 35 TOTAL: 150 Copyright reserved

Downloaded from hlayiso.com Accounting/P2 DBE/2021 SC/NSC GRADE 12 ACCOUNTING FINANCIAL INDICATOR FORMULA SHEET Gross profit x 100 Gross profit x 100 Sales 1 Cost of sales 1 Net profit before tax x 100 Net profit after tax x 100 Sales 1 Sales 1 Operating expenses x 100 Operating profit x 100 Sales 1 Sales 1 Total assets : Total liabilities Current assets : Current liabilities (Current assets – Inventories) : Current liabilities Non-current liabilities : Shareholders' equity (Trade & other receivables + Cash & cash equivalents) : Current liabilities Average trading stock x 365 Cost of sales . Cost of sales 1 Average trading stock Average debtors x 365 Average creditors x 365 Credit sales 1 Cost of sales 1 Net income after tax x 100 Net income after tax x 100 Number of issued shares 1 Average shareholders' equity 1 (*See note below) Net income before tax + Interest on loans x 100 Average shareholders' equity + Average non-current liabilities 1 Shareholders' equity x 100 Dividends for the year x 100 Number of issued shares 1 Number of issued shares 1 Interim dividends x 100 Final dividends x 100 Number of issued shares 1 Number of issued shares 1 Dividends per share x 100 Dividends for the year x 100 Earnings per share 1 Net income after tax 1 Total fixed costs . Selling price per unit – Variable costs per unit NOTE: * In this case, if there is a change in the number of issued shares during a financial year, the weighted-average number of shares is used in practice. Copyright reserved