Accounting Grade 11 P2 Gauteng June 2022 QP (Eng)

Downloaded from hlayiso.com PROVINCIAL EXAMINATION JUNE 2022 GRADE 11 ACCOUNTING (PAPER 2) TIME: 2 hours MARKS: 150 10 pages + 1 formula sheet and an answer book of 10 pages P.T.O.

Downloaded from hlayiso.com ACCOUNTING 2 (PAPER 2) GRADE 11 INSTRUCTIONS AND INFORMATION 1. Answer ALL the questions. 2. A special ANSWER BOOK is provided in which to answer ALL the questions. 3. A FORMULA SHEET for financial indicators is provided at the back of this question paper. 4. Show ALL workings to earn part-marks. 5. You may use a non-programmable calculator. 6. You may use blue/black ink to answer the questions. 7. Where applicable, show all calculations. Round off answers to ONE decimal point. 8. Write neatly and legibly. 9. Learners will forfeit marks for: • The use of non-standardised abbreviations • Overwriting of figures or words • Superfluous/foreign entries 10. Use the information in the table below as a guide when answering the question paper. Try NOT to deviate from it. QUESTION TOPIC MARKS TIME IN MINUTES 1. Concepts and Bank Reconciliation 54 42 minutes 2. Concepts and Creditors’ Reconciliation 34 28 minutes 3. Fixed Assets and Internal Control 62 50 minutes TOTAL 150 120 minutes P.T.O.

Downloaded from hlayiso.com QUESTION 1: CONCEPTS AND BANK RECONCILIATION (54 marks; 42 minutes) 1.1 CONCEPTS 1.1.1 State whether the following statements are TRUE or FALSE. Write only TRUE or FALSE next to the question number in the ANSWER BOOK. (6) 1.1.1.1 Costs charged in respect of EFTs do not form part of the bank charges. 1.1.1.2 A credit balance on the Bank Statement reflects a positive bank balance. 1.1.1.3 Interest debited on the Bank Statement will be recorded in the Cash Receipts Journal. 1.1.2 Answer the following questions: 1.1.2.1 Explain to Mabuto, the owner of Butros Traders, why it is important that he prepares the Bank Reconciliation Statement at the end of each month. Provide THREE reasons. (6) 1.1.2.2 What does the abbreviation EFT stand for? (2) 1.1.2.3 List FOUR advantages of internet banking. (8) 1.1.2.4 Jane, the bookkeeper, has been assigned the duty of processing and controlling all EFTs. Provide TWO reasons why the internal auditor should be concerned about this. (4) 1.2 BANK RECONCILIATION BUTROS TRADERS The information below relates to Butros Traders for the year ended 31 March 2022. REQUIRED: 1.2.1 Calculate the correct totals for both the Cash Receipts Journal and the Cash Payments Journal of March 2022. NOTE: Details are not required. (11) 1.2.2 Prepare the Bank Account in the General Ledger for March 2022. (6) 1.2.3 Prepare the Bank Reconciliation Statement on 31 March 2022. (11) P.T.O.

Downloaded from hlayiso.com INFORMATION: A. The Cash Journals had the following totals for the bank column on 31 March 2022, before the Bank Reconciliation was completed: Cash Receipts Journal R477 400 Cash Payments Journal R413 500 B. Extract from the Bank Reconciliation Statement on 28 February 2022: Balance as per Bank Statement ??? Outstanding deposit R84 700 Outstanding EFTs No. 415 (28 February 2022) R6 000 No. 416 (28 February 2022) R28 500 Favourable balance as per Bank Account R299 600 C. Additional information relating to the Bank Reconciliation Statement on 28 February 2022: • The outstanding deposit of R84 700 appeared on the March 2022 Bank Statement. • EFT no. 415 for R6 000 appeared on the March 2022 Bank Statement. • EFT no. 416 appeared on the March 2022 Bank Statement with the correct amount of R62 500. The amount recorded in the journal for February 2022 was incorrect. D. Entries in the Cash Journals for March 2022 that do not appear on the Bank Statement for March 2022: • EFT no. 480 for R25 000. This was for textbooks and a laptop for the owner’s son. • EFT no. 481 for R18 000 for the repairs to the business vehicle. • A cash deposit for the week ended 31 March 2022 of R124 500. P.T.O.

Downloaded from hlayiso.com E. Entries that appear on the March 2022 Bank Statement from Alli Bank, that do not appear in the Cash Journals for March 2022: Date Details R Balance 18 Mar Debit order 225 : Tee Insurers - 34 000 212 000 (Cr) 18 Mar Debit order 388 : Taa Insurers - 34 000 178 000 (Cr) 22 Mar Ekurhuleni Municipality (EFT) - 52 000 126 000 (Cr) 25 Mar L. Naidoo (EFT from tenant) 28 000 154 000 (Cr) 28 Mar Delta Bank 96 750 250 750 (Cr) 30 Mar Service fees - 1 750 249 000 (Cr) 30 Mar Interest 400 249 400 (Cr) NOTE: • Debit order 225 was for the business’s monthly insurance premium to Tee Insurers. • Debit order 388 appeared on the business’s Bank Statement on 18 March 2022. The business does not have an insurance policy with Taa Insurers. The bank agreed that the error will be corrected on the next Bank Statement. • The deposit from Delta Bank was for the fixed deposit of R90 000 that has matured. [54] P.T.O.

Downloaded from hlayiso.com QUESTION 2 : CONCEPTS AND CREDITORS’ RECONCILIATION (34 marks; 28 minutes) SEB’S SOUND CLINIC Seb’s Sound Clinic is in operation for five months, from 01 January 2022. Instead of appointing a qualified bookkeeper, Sophia, the owner’s wife, prepares the books of the business. Seb’s Sound Clinic buys most of its sound accessories from Big Music, their only creditor. REQUIRED: 2.1 Choose a description in COLUMN B that matches a concept in COLUMN A. Write only the letter (A – E) next to the question number in the ANSWER BOOK. COLUMN A COLUMN B A Summary of what each creditor is 2.1.1 Original invoice owed B Document that will appear on the Creditor’s Statement to acknowledge 2.1.2 Creditors’ List that faulty goods were accepted by the supplier 2.1.3 Debit Note C Proof that payment has been received D Document sent by the business to the 2.1.4 Credit Note supplier when goods are returned or an allowance is requested E Document that records all purchases 2.1.5 Receipt on credit (10) 2.2 Provide TWO reasons for preparing a Creditors’ Reconciliation. (4) 2.3 The owner of Seb’s Sound Clinic is not completely satisfied with the service and quality of goods received from Big Music. He is thinking about finding a new supplier. State THREE factors that he should consider before changing to another supplier. (6) 2.4 Sophia has prepared a Creditor’s Reconciliation on 31 May 2022. An investigation revealed many errors and omissions. Complete the table in the ANSWER BOOK to show how the errors and omissions identified must be treated to reconcile the Creditor’s Ledger Account balance of Big Music in the books of Seb’s Sound Clinic with the statement received from Big Music. P.T.O.

Downloaded from hlayiso.com Indicate a ‘+’ for increase, a ‘-‘ for decrease and ‘0’ for no change, with each amount in the correct column. (14) INFORMATION: 2.4.1 Balance due to Big Music on 31 May 2022, according to the Creditor’s Ledger of Seb’s Sound Clinic. R42 794 Balance on the Statement of Account received from Big Music on 28 May 2022. R46 820 Errors and omissions: 2.4.2 Big Music granted Seb’s Sound Clinic a discount of R67. Sophia credited this amount in the Creditor’s Ledger account of Big Music. 2.4.3 Invoice 147 for R8 890 was incorrectly reflected as R8 780 in the Creditor’s Ledger account of Big Music. The Statement of Account reflected the correct amount. 2.4.4 Seb’s Sound Clinic purchased wiring costing R1 600 from Big Music. This entry was omitted from the Statement of Account received from Big Music. 2.4.5 Sophia correctly recorded an EFT payment of R4 000 in the Creditor’s Ledger account of Big Music on 28 May 2022. It did not appear on the Statement of Account received. 2.4.6 Sophia made a telephonic order to Big Music for sound accessories amounting to R1 350 and immediately recorded this in the Creditor’s Ledger account of Big Music. However, this transaction did not appear on the Statement of Account received. It was also established that these items were not delivered as Big Music did not have stock and will not get stock in the near future. 2.4.7 Sophia correctly recorded an EFT payment of R2 840 and an early- payment discount of R160 on 31 May 2022 in the Creditor’s Ledger account of Big Music. This did not appear on the Statement of Account received. [34] P.T.O.

Downloaded from hlayiso.com QUESTION 3 : FIXED ASSETS AND INTERNAL CONTROLS (62 marks; 60 minutes) RATIZA TRADERS The following information related to Ratiza Traders for the year ended 28 February 2022. The partners are Oratile and Zama. REQUIRED: 3.1 Calculate the missing amounts in the Fixed Assets Note denoted by (A) to (G). (33) 3.2 Prepare the Asset Disposal Account in the General Ledger. (9) 3.3 Provide ONE suggestion that the internal auditor can use to check whether any movable assets have been stolen. (2) 3.4 Land and buildings were bought five years ago for R5 000 000. The property prices have increased by 20% since then. Partner Oratile suggested that the value of this asset be recorded at a higher amount so that the additional R1 000 000 can be reflected as a profit in the Statement of Comprehensive Income (Income Statement). Partner Zama disagrees. Give ONE reason why you would agree with partner Zama. Refer to GAAP principles in your answer. (3) 3.5 The partners suspect that some of the drivers are using the business vehicles for their private purposes. 3.5.1 Provide TWO points to justify their concerns. Quote figures to support your answer. Hint: Refer to INFORMATION F. (8) 3.5.2 List TWO points of advice on how the partners can exercise better control over the use of the business vehicles. (4) 3.6 Six of the drivers are dissatisfied with their salary increase and are planning a strike. Are they justified? Explain. Quote figures to support your answer. (3) P.T.O.

Downloaded from hlayiso.com INFORMATION: A. Depreciation on vehicles is calculated at 10% per annum on the diminishing balance method. B. A new vehicle was purchased on 01 December 2021. C. An extract from the Fixed Assets Register in respect of a vehicle that was sold during the year: Ford Fiesta Date bought: 01 March 2019 Date Sold: 30 September 2021 (Cash) Selling price: R81 348 Depreciation method: 10% p.a. (diminishing balance) Date Cost Depreciation Carrying value 29 February 2020 R132 000 R13 200 R 118 800 28 February 2021 ??? ??? 30 September 2021 ??? ??? D. Depreciation on equipment is calculated at 15% per annum using the cost price method. E. Extract from the Fixed Assets Note on 28 February 2022: Land and Vehicles Equipment Buildings Carrying value on 116 000 (A) 01 March 2021 Cost 5 000 000 576 000 460 000 Accumulated depreciation (460 000) (396 750) Movements Additions 650 000 (C) 0 Disposals 0 (E) 0 Depreciation (D) (F) Carrying value on (B) 28 February 2022 Cost 564 000 Accumulated depreciation (G) P.T.O.

Downloaded from hlayiso.com F. Additional information relating to the fixed assets of the business: 28 February 2022 01 March 2021 Delivery vehicles (cost) R564 000 R576 000 Repairs and maintenance R45 220 R32 300 Petrol and oil R114 100 R65 200 Salaries to drivers R408 240 R388 800 Sales R932 400 740 000 [62] TOTAL: 150 END

Downloaded from hlayiso.com ACCOUNTING 11 (PAPER 2) GRADE 11 FORMULA SHEET Gross profit 100 Gross profit 100 Net profit 100    Sales 1 Cost of Sales 1 Sales 1 Operating Expenses 100 Operating Profit 100   Sales 1 Sales 1 Total earnings by partner 100 Net Profit 100   Average Partners' Equity 1 Average Partners' Equity 1 Current Assets: Current Liabilities Current Assets – Inventories: Current Liabilities Average Debtors 365 12 Average Creditors 365 12  or  or Credit Sales 1 1 Credit Purchases or Cost of Sales 1 1 Average Inventorie s 365 12 Cost of Sales  or Cost of Sales 1 1 Average Inventorie s Non-Current Liabilities: Partners’ Equity Total Assets: Total Liabilities