Basson, D.P., Mr.

Osman, S., Ms.

Patel, Z., Ms.

Name not available

 
 
DEPARTMENT OF ACCOUNTANCY 
 
ACCOUNTING B – 2015 
 
[REK0B01/ ACC0BB1] 
 
FINAL ASSESSMENT OPPORTUNITY:  9 NOVEMBER 2015 
 
 
Assessor: Mr DP Basson Time: 2 hours 
 Ms S Osman 
Moderator: Ms Z Patel Marks: 90 
 
 THE ASSESSMENT OPPORTUNITY PAPER CONSISTS OF 3 QUESTION AND 8 PAGES
 (front page included). 
 YOU MUST ANSWER ALL THE QUESTIONS 
 START EVERY NEW QUESTION AT THE TOP OF A PAGE 
 WRITE IN BLUE OR BLACK INK – NO PENCIL 
 A NON-PROGRAMMABLE, SILENT CALCUTATOR MAY BE USED 
 CROSS OUT OPEN SPACES AND EMPTY PAGES 
 NO PENCIL OR TIPPEX MAY BE USED 
 PLEASE ANSWER IN THE CORRECT COLOR BOOK AS INDICATED AT TOP OF EACH 
QUESTION 
 
QUESTION TOPIC MARKS  TIME 
1. 
2. 
3. 
Partnerships                      (Blue book) 
Companies                        (Green book) 
Budget                               (Orange book) 
25 
35 
30 
 33 minutes 
47 minutes 
40 minutes 
  90  120 minutes 
 
 
 
 
 
 
COURSE:  ACCOUNTING B 
-2- 
 
QUESTION 1 (Blue book) (25 MARKS) 
 
Donald, Smith and Nel are in partnership and share profits or losses in the ratio 5:3:2.  On 30 June 
2015, the end of the reporting period of the partnership, the following is submitted to you: 
 
DONALD, SMITH, NEL 
STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2015 
 R R 
   
ASSETS   
NON-CURRENT ASSETS  835 000 
Land and buildings 350 000  
Furniture 225 000  
Equipment 200 000  
Goodwill 60 000  
   
   
CURRENT ASSETS  315 000 
Inventories 125 000  
Trade and other receivables 95 000  
Cash and Cash Equivalents 95 000  
   
TOTAL ASSETS 1 150 000 
   
EQUITY AND LIABILITIES   
EQUITY  1 000 000 
Capital : Donald             500 000   
            : Smith             300 000   
            : Nel             200 000   
Current account : Donald              50 000   
                          : Smith              75 000   
                          : Nel             (25 000)   
   
LIABILITIES  50 000 
   
CURRENT LIABILITIES   
Trade and other payables 50 000  
   
TOTAL EQUITY AND LIABILITIES 1 150 000 
 
 
 
 
 
 
 
 
 
COURSE:  ACCOUNTING B 
 
-3- 
 
ADDITIONAL INFORMATION: 
 
On 1 July 2015 Nel decided to withdraw from the partnership. For the purposes of Nel’s withdrawal 
the partners agreed on the following: 
 
1. Goodwill is valued at R58 000, but must not appear in the records of the new partnership. 
 
2. The following assets have been revalued at the respective amounts: 
 
Land and buildings    405 000 
Furniture     250 000 
Equipment     197 000 
Trade and other receivables       90 000 
 
3. Donald and Smith will share profits and losses in future in the ratio 2:3. 
 
4. The balance on Nel’s capital account will be paid by electronic transfer. 
 
 
 
REQUIRED: 
 
Prepare the capital accounts of the partners in column form.   (25)
COURSE:  ACCOUNTING B 
-4- 
 
This question consists of two independent parts: 
 
PART A 
 
QUESTION 2(A) (Green book) (11 MARKS) 
 
Ally Limited has been formed on 1 July 2014 with an authorised share capital of: 
 
100 000 ordinary shares  
50 000   8% preference shares   
 
ADDITIONAL INFORMATION: 
 
1. The founders of the company applied and paid for 40 000 ordinary shares at R1.50 
per share. The shares were allocated to them.   
 
2. On 1 January 2015 a further 40 000 ordinary shares were offered to the public at R1.50 
each.  Application and payments were received for 60 000 shares.  The 40 000 shares 
were allotted and all unsuccessful applicants were refunded. 
 
3. 50 000 8% preference shares of R1 each were offered to the public.  Subscriptions 
were received for 50 000 8% preference shares and all the shares were allotted. 
 
 
REQUIRED: 
 
Journalise the above mentioned transactions in the general journal for the reporting period 
ended 30 June 2015 (11) 
 
 
  
COURSE:  ACCOUNTING B 
-5- 
PART B: 
 
QUESTION 2(B) (Green book) (24 MARKS) 
 
 
FEDCON LIMITED 
 Statement of profit or loss for the year ended 30 September 2015 
 Note  R  R 
Sales    1 850 000 
Sales   1 900 000  
Sales returns   (50 000)  
    
Cost of sales    (680 000) 
Opening inventories   180 000  
Purchases   725 000  
   905 000  
Closing inventories   (225 000)  
Gross profit    1 170 000 
Other income    48 700 
Rent income   16 000  
Dividends income 1  18 000  
Interest income 1  7 500  
Profit on sale of machinery   2 500  
Profit on sale of shares   4 700  
Expenses     (758 000) 
Salaries and wages 2  350 000  
Salary:  Managing director Mr. Wright   180 000  
Petrol 2  45 000  
Water and electricity   28 000  
Bad debts   6 000  
Auditors’ fees   43 000  
Loss on sale of vehicles   6 500  
Loss on re-measurement of investment   3 500  
Interest expense   4 000  
Depreciation 3  32 000  
Rent of buildings   57 000  
Donations   3 000  
    460 700 
Income tax expense    (133 000) 
    327 700 
Ordinary dividends 4  30 000  
Preference dividends 4  18 000  (48 000) 
Profit for the year    279 700 
 
 
 
 
 
 
 
 
 
COURSE:  ACCOUNTING B 
-6- 
 
ADDITIONAL INFORMATION: 
 
1. Dividends and interest are received from 
  R 
 Elegance Ltd 8 000 
 Team (Pty) Ltd 10 000 
 Interest is received from Elegance Ltd 7 500 
 
2. Included in the salaries and wages is R72 000 that was paid to the non-executive 
director, Mr Bester, while R5 000 of the fuel expenses was for the fuel of Mr Bester to 
attend the meetings. 
 
3. Depreciation for the reporting period amounted to R20 000 for vehicles and R12 000 for 
 machinery. 
 
4. The issued share capital of the company on the reporting date consisted of: 
 
 1 000 000 ordinary shares of R0.50 each 
 300 000 redeemable 6% preference shares of R1 each. 
 
REQUIRED: 
 
 Prepare the statement of comprehensive income of Fedcon Ltd for the reporting period 
ended 30 September 2015.  The statement as well as the notes must comply with the 
minimum requirements of the Companies Act, and International Financial Reporting 
Standards (IFRS).                  (24) 
 
Please note:  All the notes to the statement of comprehensive income are required. 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
COURSE:  ACCOUNTING B 
-7- 
 
QUESTION 3 (Orange book) (30 MARKS) 
 
John Wilson intends on starting a business called Wilson Traders, on 1 September 2015.  He 
carried out an investigation in this regard but is not sure whether his cash will be sufficient for 
the functioning of his business.  He requests your advice in respect of the business and 
supplies you with the following information: 
 
1. A loan of R200 000 at an interest rate of 9% per year will be obtained from Africa Bank 
on 1 September 2015.  The loan is repayable at R8 000 monthly at the end of each 
month plus the monthly interest. 
 
2. The estimated sales to 28 February 2016 will be R1 300 000 and will take place as 
follows: 
 
 September R176 000 
 October 198 000 
 November 254 000 
 December 188 000 
 January 264 000 
 February 220 000 
 
 It is expected that 20% of all sales will be for cash and the balance on credit.  According 
to information from this industrial sector, receivables pay their accounts as follows: 
 
 10% in the month of sales 
 60% in the month following the month of sales 
 25% in the next month 
 5% is normally irrecoverable and is written off at the end of the month in which the last 
payment was received. 
 
3. Purchases for the first three months will be: 
 
 September R267 000 
 October 110 500 
 November 55 000 
 
 All purchases will be on credit.  Fifty percent of payables will be paid during the month 
of purchases to get 10% discount and the balance of the payables will be paid in the 
month following the month of purchases. 
 
4. Employees will receive the following remuneration at the end of each month: 
 
 Salaries R12 000 
 Two percent commission on cash sales. Commission on cash sales are paid on the last 
day of each month for that month. 
  
5. Other operating expenses amount to 10% of total sales and are payable monthly.   
 
6. Mr. Wilson has overdraft facilities of R100 000.  Interest on the overdraft will be charged 
at 12% per year on the balance as at the beginning of the month. 
 
 
COURSE:  ACCOUNTING B 
-8- 
 
REQUIRED: 
 
Prepare the cash budget, for Wilson Traders, for the three months September, October and 
November 2015. (30) 
 
 Please note:  Wilson Traders is NOT registered for VAT purposes.   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


Accounting B

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Accounting B

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