Financial Accounting Principles Concepts and Procedures (FAC1502)
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KK Trading is a registered VAT vendor and makes use of the periodic inventory system.
The following information relates to K Mathi, one of the creditors of KK Trading.
K Mathi’s balance as per the trade payables ledger as at 30 June 2024 was R6 747.
The following information had not been considered in correcting of the trade payables ledger:
An invoice of R695 (VAT exclusive) in respect of freight on goods purchased was received from K Mathi. No entry has as yet been made.
Required:
Prepare the corrected account of the creditor in the trade payables ledger
Instructions:
1. Use a full stop to indicate any decimals (eg: 1000.01)
2. Round off to the second decimal after the full stop (eg: 50.56)
3. Only show the amount, do not show the "R" (eg: 1000)
4. If no amount should be recorded in any of the numeric spaces, please indicate it by filling in a zero ("0")
K Mathi
Debit Credit Balance
2024 R R R
Jun 30
Invoice total b/d 6747.00 Cr
Purchases PJ 0 695.00 7442.00 Cr
Question 2
State whether the following statement is true or false:
Answer saved
To determine the closing inventory amount when an entity uses the periodic inventory system, a physical inventory count is done at the end of the financial period.
Marked out of
1.00
Flag
question Select one:
True
False
Question 3 Ronnie Dealers is a registered VAT vendor and applies the principles of the perpetual inventory system.
Answer saved
On 31 March 2024, the bookkeeper reconciled the individual creditor accounts and the trade and other payables control account. The bookkeeper noticed that an amount of R1 775 paid for
Marked out of inventory was incorrectly analysed to the Trade and other payables control account in the cash payments journal. The VAT portion of the transaction was correctly recorded. No entry was made
5.00
in the accounting records of Ronnie Dealers to correct the error.
Flag What will the correct general journal entry for the given transaction in the books of Ronnie Dealers be?
question
Instructions:
1. Use a full stop to indicate any decimals (eg: 1000.01)
2. Round off to the second decimal after the full stop (eg: 50.56)
3. Do not type in “R” for Rand in the numeric block
4. If any debit or credit line item is not applicable indicate the account name by choosing N/A from the list and complete the amount as zero "0"
Debit Credit
R R
31
Inventory 1775.00
Trade and other payables control 1775.00
Correction of inventory erroneously
posted to the trade and other payables
control account
Question 4 Tyamo Traders is a registered VAT vendor and applies the principles of the perpetual inventory system.
Answer saved The following information was extracted from the financial records of Tyamo Traders on 30 June 2024.
Marked out of
10.00
TYAMO TRADERS
Flag
question EXTRACT FROM THE TRIAL BALANCE AS AT 30 JUNE
2024
Debit Credit
R R
Capital: S Tyamo (1 July 2023) 320 000
Drawings 19 340
Loan receivable 215 000
Inventory: Trading 32 500
Additional information:
The following information must still be taken into account for the year ended 30 June 2024:
a) During the current financial year, the owner contributed an amount of R41 970. The accountant mistakenly didn’t account for it.
b) Revenue for the year amounted to R431 700
c) Cost of sales for the year amounted to R235 150
d) Distribution, administrative and other expenses for the year amounted to R115 625
Required:
, Prepare the Statement of changes in equity for the year ended 30 June 2024
Instructions for numeric responses:
1. Use a full stop to indicate any decimals (eg: 1000.01)
2. Round off to the second decimal after the full stop (eg: 50.56)
3. All amounts that will be deducted from the balance must be recorded with a negative sign in front of the amount (eg: -1000.01)
4. When no amount needs to be entered in a column, then indicate this by entering "0" in the column.
Tyamo Traders
Statement of changes in equity for the year ended 30 June 2024
Capital
R
Balance as at 1 July 2023 320000.00
Capital contribution 41970.00
Comprehensive income for the year 80925.00
Less: Drawings -19340.00
Balance as at 30 June 2024 423555.00
Question 5
You are given the following information for Thabo's Plumbers:
Answer saved
Marked out of
R
1.00 Services rendered for cash 20 000
Flag
question Clients owing for services rendered 4 000
Wages 10 000
Water and electricity 3 000
Petrol 6 000
Interest received on favourable bank balance 400
Credit losses recovered 1 000
Consumables 8 000
Bank charges 600
EFT for rent paid to WR Estate Agency 13 600
Interest earned on a 30 day fixed deposit 1 400
Total income for Thabo's Plumbers is ....
NB: Instructions
1. Do not type the amount with any spaces as separators for thousands (eg: 12141)
2. Round off to the nearest Rand (eg: 50.56 is 51)
3. Only show the amount, do not show the R (eg: 12141)
4. Show a total comprehensive loss with a “– sign”.
Answer: 26800.00
Question 6
Dintsalo Trading, a registered VAT vendor, uses the periodic inventory system. The VAT rate is 15%.
Answer saved
The following is an extract from the financial records of Dintsalo Trading for January 2024:
Marked out of
20.00 R
Flag
question
Trade receivables: opening balance (1 January) 128 400
Credit sales 204 800
Cash receipts journal: Trade receivables column total (31 167 400
January)
Sales returns journal: Trade receivables column (31 9 600
January)
At month's end, the Bookkeeper completed a debtor’s reconciliation and found the following:
1. On 10 January, a client returned goods sold to him on credit in the amount of R3 860. This transaction was incorrectly recorded in the Purchases returns journal instead of the Sales returns
journal.
2. On 18 January, Mr J Bhaca, paid R2 740 cash in partial settlement of his account. This transaction has not yet been recorded.
3. The trade receivables column in the sales journal was overcast by R4 580.
4. On 15 January 2024 Dintsalo Trading was informed that S Swallows, a debtor who owed the entity R2 620, had been declared insolvent. The amount must be written off as irrecoverable.
5. On 31 January 2024 DintsaloTrading charged interest on overdue clients’ accounts of R920.
Required:
Complete the trade receivables account in the general ledger of DintsaloTrading for the month ending 31 January 2024.
Instructions:
1. Use a full stop to indicate any decimals (eg: 1000.01)
2. Round off to the second decimal after the full stop (eg: 50.56)
3. If no amount should be recorded in any of the numeric spaces, please indicate it by filling in a zero ("0")
4. Only show the amount, do not show the "R" (eg: 1000)
, Dr Trade receivables control Cr
2024 R 2024 R
Jan 1 Balance b/d 128400.00
Jan 1 Balance b/d 0
31 Sales SJ 200220.00
31 Bank CRJ 170140.00
Interest income SRJ 920.00 Credit losses SJ 2620.00
Sales returns SRJ 9600.00
Balance c/d 0
Balance c/d 147180.00
329540.00 329540.00
Feb 1 Balance b/d Feb 1 Balance b/d
147180.00 0
Question 7 Arch Traders designs and builds arches for gardens. The financial year-end of the business is 28 February. Arch Traders is not a registered VAT vendor.
Answer saved You are given the following extract of the pre-adjustment trial balance for Arch Traders for the financial year ended 28 February 2024.
Marked out of
25.00 ARCH TRADERS
Flag EXTRACT OF THE PRE-ADJUSTMENT TRIAL BALANCE AS AT 28 FEBRUARY 2024
question
Debit Credit
R R
Capital 525 000
Drawings 25 000
Buildings 150 000
Land 450 000
Equipment 330 400
Accumulated depreciation: Equipment (1 October 70 800
2023)
Trade receivables control 225 000
Inventory 250 000
Bank overdraft 714 750
Trade payables control 300 000
Additional information
a) Included in the cost price of equipment on the pre-adjustment trial balance is new equipment bought on 1 September 2023 to the value of R94 400.
b) On 1 February 2024 old equipment with a cost price of R70 800, bought on 1 March 2022, was sold for R 63 720.
b) Depreciation for the year must be provided as follows:
- Equipment: 12% per annum on the diminishing balance method
Required:
Compile the property, plant and equipment note for equipment (total column excluded) for Arch Traders on 28 February 2024.
Instructions for numeric responses:
1. Use a full stop to indicate any decimals (eg: 1000.01)
2. Round off to the second decimal after the full stop (eg: 50.56)
3. All amounts that will decrease the closing balance of assets must be recorded with a negative sign in front of the amount (eg: -1000.01)
4. When no amount needs to be entered in a column, then indicate this by entering "0" in the column.
Arch Traders
Notes to the financial statements for the year ended 28 February
2024
Property, plant and equipment Equipment
R
Residual value: Beginning of the year 236000.00
Cost 306800.00
Accumulated depreciation -70800.00
Additions 94400.00
Disposals -55450.56
Cost 70800.00
Accumulated depreciation -15349.44
Depreciation for the year -41772.00
Carrying amount: End of the year 233177.44
Cost 330400.00
Accumulated depreciation -97222.56
Question 8
An entity has the following balances: Bank: R3 000; Vehicles: R12 000: Trade receivables: R2 000.
Answer saved
The equity of the entity according to the basic accounting equation is …
Marked out of
1.00
, Flag NB: Instructions
question
1. Use a full stop to indicate any decimals (eg: 1000.01)
2. Only show the amount, do not show the R (eg: 12141.72)
Answer: 17000.00
Question 9 NKONZO TRADERS EXTRACT FROM THE LIST OF BALANCES AS AT 28 FEBRUARY 2024
Answer saved
R
Marked out of
8.00
Fixed deposit: ABC Bank (7,5%) 1 062 000
Interest on fixed deposit 39 825
Flag
question
Additional information
On 1 June 2023, Nkonzo Traders invested money in a three-year fixed deposit account with ABC Bank at 7,5% interest per annum. The interest is payable quarterly. Account for any outstanding
interest.
Required
Using the information given, show the disclosure of the fixed deposit in the financial statements of Nkonzo Traders for the year ended 28 February 2024.
Instructions for numeric responses:
1. Use a full stop to indicate any decimals (eg: 1000.01)
2. Round off to the second decimal after the full stop (eg: 50.56)
3. Only show the amount, do not show the "R" (eg: 1000)
4. If no amount should be recorded in any of the numeric spaces, please indicate it by filling in a zero ("0")
NKONZO TRADERS STATEMENT OF PROFIT AND LOSS AND OTHER
COMPREHENSIVE INCOME FOR THE YEAR ENDED 28 FEBRUARY 2024
(EXTRACT)
R
Other income Interest income: fixed 59737.50
deposit
NKONZO TRADERS STATEMENT OF FINANCIAL POSITION AS AT 28 FEBRUARY 2024
(EXTRACT)
ASSETS R
Non-current assets
Financial assets: fixed deposit at ABC Bank 1062000.00
Current assets
Trade and other receivables 19912.50
Question 10 Indicate by choosing the correct option whether the following statement is true or false:
Answer saved Under a periodic inventory system, the cost of sales is not determined at the time of the recording of the sale.
Marked out of
1.00
Flag
question Select one:
True
False
Question 11
Mandla Traders' (not a registered VAT vendor) financial year ends annually on 31 December. The business uses the perpetual inventory system. During the current financial year of 20.22, Mandla
Answer saved
Traders had credit sales of R338 000. The company applies a 30% mark-up on selling price.
Marked out of
9.00 The correct recording of the transaction in the general ledger of Mandla Traders will be:
Flag Instructions:
question
1. Use a full stop to indicate any decimals (eg: 1000.01)
2. Round off to the nearest Rand (eg: 50.56 is 51)
3. Only show the amount, do not show the R (eg: 12141.72)
Dr Cost of sales Cr
20.22 20.22
Dec 31 SJ Dec 31 GJ
Inventory 219700.00 Trading account 219700.00
219700.00 219700.00
Dr Sales Cr
20.22 20.22
Dec 31 Trading account GJ 338000.00 Dec 31 Trade receivables control SJ 338000.00
338000.00 338000.00
.
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