Accounting Grade 10 National November 2017 Addendum (Eng)

1 ACCOUNTING (ANSWER BOOK) (EC/NOVEMBER 2017) NATIONAL SENIOR CERTIFICATE GRADE 10 NOVEMBER 2017 ACCOUNTING ANSWER BOOK MARKS MODERATED QUESTION MAX MARKS OBTAINED MARKS 1 55 2 55 3 65 4 40 5 30 6 55 300 *XACBE* This answer book consists of 15 pages. Copyright reserved Please turn over

2 ACCOUNTING (ANSWER BOOK) (EC/NOVEMBER 2017) QUESTION 1: ACCOUNTING CONCEPTS, DEBTORS, INTERNAL CONTROL AND ACCOUNTING EQUATION 1.1 ACCOUNTING CONCEPTS 1.1.1 1.1.6 1.1.2 1.1.7 1.1.3 1.1.8 1.1.4 1.1.9 1.1.5 1.1.10 10 1.2 DEBTORS 1.2.1 DEBTORS LEDGER OF MARY LEE STORES TT Rosie DATE DETAILS FOL DEBIT CREDIT BALANCE 12 1.2.2 What information about a prospective debtor does this business need before an account can be opened? Give a reason for your answer. INFORMATION REASON 4 1.2.3 Name TWO methods the business can apply to improve the collection of outstanding amount from debtors. 2 Copyright reserved Please turn over

3 ACCOUNTING (ANSWER BOOK) (EC/NOVEMBER 2017) 1.3 ACCOUNTING EQUATION ASSETS OWNER’S EQUITY LIABILITIES NO JOURNAL REASON EFFECT REASON EFFECT REASON EFFECT E.g. CPJ Bank - 200 Drawings - 200 1.3.1 1.3.2 1.3.3 1.3.4 27 Q1 55 Copyright reserved Please turn over

4 ACCOUNTING (ANSWER BOOK) (EC/NOVEMBER 2017) QUESTION 2: GENERAL JOURNAL, GENERAL LEDGER AND INTERNAL CONTROL 2.1 GENERAL JOURNAL General Journal of AM Traders – October 2017 DEBTORS CONTROL CREDITORS CONTROL DAY DETAILS DEBIT CREDIT DEBIT CREDIT DEBIT CREDIT 31 Totals 492 236 632 298 20 Copyright reserved Please turn over

(EC/NOVEMBER 2017) ACCOUNTING (ANSWER BOOK) 5 2.2 GENERAL LEDGER GENERAL LEDGER OF AM TRADERS Trading Stock DATE DETAILS FOL AMOUNT DATE DETAILS FOL AMOUNT 2017 2017 Oct Oct 14 Creditors Control DATE DETAILS FOL AMOUNT DATE DETAILS FOL AMOUNT 2017 2017 Oct Oct Nov 9 Stationery DATE DETAILS FOL AMOUNT DATE DETAILS FOL AMOUNT 2017 2017 Oct Oct 6 Copyright reserved Please turn over

6 ACCOUNTING (ANSWER BOOK) (EC/NOVEMBER 2017) 2.3 INTERNAL CONTROL What can the owner of AM Traders do to ensure that stock is not stolen by his employees? State THREE internal control measures. 6 Q2 55 Copyright reserved Please turn over

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8 ACCOUNTING (ANSWER BOOK) (EC/NOVEMBER 2017) QUESTION 3: FIXED ASSETS, INTERNAL CONTROL AND INCOME STATEMENT 3.1.1 ASSET REGISTER MALAMBO TRADERS ASSET REGISTER: VEHICLES Mahindra Pik-up- Item: Purchased from: Mahindra PE Loader Date of 1 December 2015 Cost price: R110 000 purchase: Depreciation 20% on diminishing balance method: ACCUMULATED DATE DEPRECIATION BOOK VALUE DEPRECIATION 29 Feb 2016 26 400 28 Feb 2017 MALAMBO TRADERS ASSET REGISTER: EQUIPMENT Canon Pixma Capital Item: Purchased from: MX924 contribution Date received: 1 March 2016 Cost price: R14 000 Depreciation 10% on cost price method: ACCUMULATED DATE DEPRECIATION BOOK VALUE DEPRECIATION 28 Feb 2017 10 3.1.2 State ONE reason why the asset register is a valuable tool in asset management. 2 3.1.3 Make TWO suggestions on how the business can improve the safety of their vehicles. 4 Copyright reserved Please turn over

(EC/NOVEMBER 2017) ACCOUNTING (ANSWER BOOK) 9 3.2.1 INCOME STATEMENT OF MALAMBO TRADERS FOR THE YEAR ENDING 28 FEBRUARY 2017 Sales Cost of sales Gross profit Other operating income Gross operating income Expenses Packaging 3 656 Advertising 1 900 Salaries 170 000 Operating profit Profit before interest expense Net profit for the year 43 3.2.2 Interest income 6 Q3 65 Copyright reserved Please turn over

10 ACCOUNTING (ANSWER BOOK) (EC/NOVEMBER 2017) QUESTION 4: GAAP PRINCIPLES AND INTERPRETATION OF FINANCIAL STATEMENTS 4.1 GAAP PRINCIPLES 4.1.1 4.1.2 4.1.3 4.1.4 4.1.5 5 4.2.1 INTERPRETATION OF FINANCIAL STATEMENTS (a) Current ratio 3 (b) Acid test ratio 4 (c) Net profit percentage on sales 3 Copyright reserved Please turn over

(EC/NOVEMBER 2017) ACCOUNTING (ANSWER BOOK) 11 4.2.2 Comment on the return on owner’s equity. Provide a calculation to support your comment. (Use average equity.) 8 4.2.3 Solvency ratio Is Langa Traders in a position to acquire another long term loan? Motivate your answer. 11 4.2.4 Mark-up percentage Give TWO reasons why the target was not achieved. 6 Q4 40 Copyright reserved Please turn over

12 ACCOUNTING (ANSWER BOOK) (EC/NOVEMBER 2017) QUESTION 5: VAT, SALARIES AND INTERNAL CONTROL 5.1 VAT 5.1.1 5.1.2 5.1.3 5.1.4 5.1.5 5 5.2 SALARIES 5.2.1 Name TWO methods that the employer can use to improve the productivity of employees. 4 Copyright reserved Please turn over

13 ACCOUNTING (ANSWER BOOK) (EC/NOVEMBER 2017) 5.2.2 SALARIES JOURNAL Salaries journal of Jakaranda Traders – October 2017 DEDUCTIONS CONTRIBUTIONS GROSS NET EMPLOYEES MEDICAL PENSION PENSION SALARY UIF PAYE TOTAL SALARY UIF AID FUND FUND G Zikwe 13 700 137 1 000 822 137 T Titus 17 900 179 800 12 459 2 148 C Cartoon 12 900 774 2 322 4 225 129 21 CALCULATIONS OF PAYE Q5 30 Copyright reserved Please turn over

14 ACCOUNTING (ANSWER BOOK) (EC/NOVEMBER 2017) QUESTION 6: COST ACCOUNTING AND BUDGET 6.1.1 CHOOSE THE CORRECT TERM (a) (b) (c) 6 6.1.2 COST CALCULATIONS AND ADVICE A COST ITEM CALCULATION ANSWER DIRECT LABOUR COST DIRECT MATERIAL COST OVERHEAD COST TOTAL COST OF PRODUCTION UNIT COST OF PROCUTION SELLING PRICE 17 B Name TWO things that Mary can do in order to decrease her cost. 4 C Advise Mandy on THREE marketing strategies that she can implement at the school to improve her sales. 6 Copyright reserved Please turn over

(EC/NOVEMBER 2017) ACCOUNTING (ANSWER BOOK) 15 6.2 BUDGETS 6.2.1 Calculate the total cost of the tour for the players. INCOME Sponsorship Donation TOTAL INCOME EXPENSES BUDGET ITEM CALCULATION ANSWER Transport Accommodation Meals and refreshments Kit TOTAL EXPENSES TOTAL COST OF THE TOUR FOR THE PLAYERS 18 6.2.2 The team has financial problems as some players cannot afford the amount expected of them. Suggest TWO ways to solve the problem. 4 Q6 55 TOTAL: 300 Copyright reserved Please turn over