FAC1501 May/Jun 2014 exam paper — questions

🔒 Scan locked
View the paper as written🔒 with a pass

  1. Question 1 · Accounting equation & classification · 18 marks

    Score Traders is a service entity that opened an internet shop in 2008. The following transactions were extracted from those entered into by Score Traders during April 2014: (1) printing ink cartridges were bought for R2 550 cash and immediately used to replace the old ones; (2) one of the computers was sent for repairs on credit, with invoice number 2022 for R350 received; (3) Score Traders, which also sells memory sticks, purchased inventory of 20 memory sticks for R3 000 cash; (4) 7 memory sticks were sold for cash at R250 each, with the cost of sales for these 7 sticks amounting to R1 050; (5) total internet fees charged to customers during the month came to R9 500 cash. Additional information: Score Traders is not registered for VAT, and the entity uses the perpetual inventory system. Using a table similar to the format illustrated (with columns for the transaction number, the account debited and account credited in the general ledger, and the effect on the accounting equation split into Assets (A), Equity (E) and Liabilities (L)), analyse each of the five transactions of Score Traders for April 2014. For each transaction, indicate which account must be debited and which account must be credited in the general ledger, and show the effect of the transaction on the accounting equation using a '+' sign for an increase and a '-' sign for a decrease. Where applicable, assume that the bank balance is positive. As an example, if the entity paid wages of R150 cash, this would be shown as: account debited - Wages; account credited - Bank; effect on A = -R150; effect on E = -R150; effect on L = no effect (-).Show the full question

  2. Question 2.1 · Bank reconciliation · 6 marks

    Question 2 consists of two unrelated parts, Part A and Part B. Part A: Computer Traders provides the following information for its financial year ended 31 January 2014: inventory on 1 February 2013 was R50 700; sales amounted to R480 500; purchases amounted to R230 100; sales returns were R14 800; purchase returns were R5 600; carriage on sales was R20 300; carriage on purchases was R12 400; and customs and excise duties on purchases were R8 900. Computer Traders applies a periodic inventory system, and a physical inventory count performed on 31 January 2014 revealed inventory on hand valued at R40 200. Calculate the cost of sales of Computer Traders for the financial year ended 31 January 2014, showing all calculations and not only the final answer.Show the full question

  3. Question 2.2 · Bank reconciliation · 5 marks

    Question 2 consists of two unrelated parts, Part A and Part B. Part B: The accountant of Camera Traders drew up the cash receipts journal and cash payments journal for April 2014 before receiving the April 2014 bank statement. Before the bank statement was received, the journal totals were: total cash receipts R68 300 and total cash payments R53 400. On 1 April 2014 the bank account in the general ledger showed a favourable balance of R26 950, and on 30 April 2014 the bank statement showed a favourable balance of R15 600. Comparing the bank statement to the cash journals revealed the following: (1) items appearing only on the bank statement were bank charges of R500 and interest income of R600; (2) cheques recorded in the cash payments journal but not yet presented to the bank were cheque no. 930 for R2 500, cheque no. 940 for R4 700 and cheque no. 970 for R1 900; (3) a credit entry of R3 100 appearing only on the bank statement was a direct deposit made by a debtor; (4) deposits totalling R35 850 recorded in the cash receipts journal had not yet been credited by the bank; (5) a cheque for R4 300 drawn by another entity was incorrectly reflected on Camera Traders' bank statement; (6) the bank returned, unpaid and marked 'refer to drawer', a cheque for R2 000 that had been received from a debtor; and (7) Camera Traders sublets part of its building to Radio Dealers, who pays a monthly rental of R3 600 via internet banking, and this R3 600 credit entry appears only on the bank statement. Required: complete the cash receipts journal and the cash payments journal of Camera Traders for April 2014, showing the details and bank columns only.Show the full question

  4. Question 2.3 · Bank reconciliation · 5 marks

    Question 2 consists of two unrelated parts, Part A and Part B. Using the same Camera Traders information given for April 2014 (Part B), prepare the properly balanced/closed-off bank account for April 2014 in the general ledger of Camera Traders.Show the full question

  5. Question 2.4 · Bank reconciliation · 6 marks

    Question 2 consists of two unrelated parts, Part A and Part B. Using the same Camera Traders information given for April 2014 (Part B), prepare the bank reconciliation statement of Camera Traders as at 30 April 2014.Show the full question

  6. Question 3.1 (CRJ) · Journals & posting to the ledger · 10 marks

    P Home set up a general dealer business known as P Home Dealers, which is registered as a VAT vendor. The following transactions were undertaken by P Home Dealers during March 2014: on 1 March, P Home deposited R40 000 into the business bank account as start-up capital and receipt number 01 was issued; on the same day cheque number 001 for R1 482 was issued to Rent-Me Properties for the monthly rental. On 2 March, goods to the value of R24 510 were bought for cash and paid using cheque number 002, and equipment costing R15 000 was bought on credit from Equip Supplies, with invoice number 113 received. On 5 March, cheque number 003 was issued to Teldigit, covering R798 for a telephone installation and R171 for prepaid airtime. On 7 March, goods worth R3 500 were sold on credit to A Mali, who immediately paid R500 in cash as a part payment; invoice number 01 and receipt number 02 were issued. On 15 March, cheque number 004 for R1 800 was issued to cover the weekly wages, and the total cash sales recorded on cash register roll number 001 came to R3 990. On 22 March, cheque number 005 for R5 000 was issued to Equip Supplies as a part payment for the equipment bought on 2 March. On 25 March, A Mali paid a further R1 000 as part payment for the goods bought on 7 March, and receipt number 03 was issued. On 29 March, total cash sales per cash register roll number 002 amounted to R12 426. On 30 March, a delivery truck costing R75 000 was purchased on credit. Additional information: VAT is calculated at 14% and is already included in the amounts above where applicable; P Home Dealers uses the periodic inventory system. For P Home Dealers, prepare the cash receipts journal (CRJ) for March 2014, providing analysis columns for Day, Details, Bank, Sales, Debtors control, VAT output and Sundry accounts. You are told to ignore the analysis of the receipts column.Show the full question

  7. Question 3.1 (CPJ) · Journals & posting to the ledger · 11.5 marks

    P Home set up a general dealer business known as P Home Dealers, which is registered as a VAT vendor. The following transactions were undertaken by P Home Dealers during March 2014: on 1 March, P Home deposited R40 000 into the business bank account as start-up capital and receipt number 01 was issued; on the same day cheque number 001 for R1 482 was issued to Rent-Me Properties for the monthly rental. On 2 March, goods to the value of R24 510 were bought for cash and paid using cheque number 002, and equipment costing R15 000 was bought on credit from Equip Supplies, with invoice number 113 received. On 5 March, cheque number 003 was issued to Teldigit, covering R798 for a telephone installation and R171 for prepaid airtime. On 7 March, goods worth R3 500 were sold on credit to A Mali, who immediately paid R500 in cash as a part payment; invoice number 01 and receipt number 02 were issued. On 15 March, cheque number 004 for R1 800 was issued to cover the weekly wages, and the total cash sales recorded on cash register roll number 001 came to R3 990. On 22 March, cheque number 005 for R5 000 was issued to Equip Supplies as a part payment for the equipment bought on 2 March. On 25 March, A Mali paid a further R1 000 as part payment for the goods bought on 7 March, and receipt number 03 was issued. On 29 March, total cash sales per cash register roll number 002 amounted to R12 426. On 30 March, a delivery truck costing R75 000 was purchased on credit. Additional information: VAT is calculated at 14% and is already included in the amounts above where applicable; P Home Dealers uses the periodic inventory system. For P Home Dealers, prepare the cash payments journal (CPJ) for March 2014, providing analysis columns for Day, Details, Bank, Purchases, Creditors control, VAT input and Sundry accounts.Show the full question

  8. Question 3.2 · Journals & posting to the ledger · 3.5 marks

    P Home set up a general dealer business known as P Home Dealers, which is registered as a VAT vendor. The following transactions were undertaken by P Home Dealers during March 2014: on 1 March, P Home deposited R40 000 into the business bank account as start-up capital and receipt number 01 was issued; on the same day cheque number 001 for R1 482 was issued to Rent-Me Properties for the monthly rental. On 2 March, goods to the value of R24 510 were bought for cash and paid using cheque number 002, and equipment costing R15 000 was bought on credit from Equip Supplies, with invoice number 113 received. On 5 March, cheque number 003 was issued to Teldigit, covering R798 for a telephone installation and R171 for prepaid airtime. On 7 March, goods worth R3 500 were sold on credit to A Mali, who immediately paid R500 in cash as a part payment; invoice number 01 and receipt number 02 were issued. On 15 March, cheque number 004 for R1 800 was issued to cover the weekly wages, and the total cash sales recorded on cash register roll number 001 came to R3 990. On 22 March, cheque number 005 for R5 000 was issued to Equip Supplies as a part payment for the equipment bought on 2 March. On 25 March, A Mali paid a further R1 000 as part payment for the goods bought on 7 March, and receipt number 03 was issued. On 29 March, total cash sales per cash register roll number 002 amounted to R12 426. On 30 March, a delivery truck costing R75 000 was purchased on credit. Additional information: VAT is calculated at 14% and is already included in the amounts above where applicable; P Home Dealers uses the periodic inventory system. Using the cash receipts journal and cash payments journal prepared for P Home Dealers, draw up the bank account for March 2014 in the general ledger, ensuring it is properly balanced or closed off at the end of the month.Show the full question

  9. Question 4.1 · Financial statements · 28 marks

    RG Stores supplied the following pre-adjustment trial balance as at 28 February 2014, drawn from its financial records for the year then ended. Financial position section (debit unless shown as credit): Capital at 1 March 2013 – credit R390 000; Drawings – R50 000; Land and buildings – R680 000; Vehicles – R350 000; Equipment – R400 000; Accumulated depreciation on vehicles – credit R70 000; Accumulated depreciation on equipment – credit R40 000; Debtors control – R30 000; Creditors control – credit R16 650; Inventory – R54 000; Bank – R45 000; Petty cash – R1 500; Cash float – R2 500. Nominal accounts section: Sales – credit R1 954 000; Cost of sales – R760 000; Sales returns – R5 000; Rental income – credit R32 500; Stationery – R3 500; Bank charges – R300; Insurance – R6 750; Wages and salaries – R48 000; Water and electricity – R24 000; Telephone expenses – R36 000; Settlement discount granted – R700; Settlement discount received – credit R900; Advertising – R4 800; Credit losses – R2 000. Both the debit and credit columns total R2 504 050. The following additional information must also be taken into account: (a) a physical inventory count performed on 28 February 2014 showed inventory on hand of R52 000 and stationery on hand of R500; (b) the account of Mrs A Singh for R1 500 must be written off as irrecoverable and an allowance for credit losses of R3 000 must be created; (c) depreciation must be provided at 10% per annum on the straight-line method on equipment and at 20% per annum on the reducing-balance method on vehicles; (d) on 1 October 2013 RG Stores agreed to rent out a section of its building to a customer at a monthly rental of R6 500 payable on the 1st of every month – the tenant paid R32 500 to RG Stores on 1 November 2013 but only took occupation of the building on 1 December 2013; (e) the insurance figure includes a prepaid amount of R1 350; and (f) a water and electricity account of R1 500 remains outstanding as at 28 February 2014. Using the pre-adjustment trial balance and additional information (a) to (f) given for RG Stores, prepare the statement of profit or loss and other comprehensive income for RG Stores for the year ended 28 February 2014.Show the full question

  10. Question 4.2 · Financial statements · 7 marks

    RG Stores supplied the following pre-adjustment trial balance as at 28 February 2014, drawn from its financial records for the year then ended. Financial position section (debit unless shown as credit): Capital at 1 March 2013 – credit R390 000; Drawings – R50 000; Land and buildings – R680 000; Vehicles – R350 000; Equipment – R400 000; Accumulated depreciation on vehicles – credit R70 000; Accumulated depreciation on equipment – credit R40 000; Debtors control – R30 000; Creditors control – credit R16 650; Inventory – R54 000; Bank – R45 000; Petty cash – R1 500; Cash float – R2 500. Nominal accounts section: Sales – credit R1 954 000; Cost of sales – R760 000; Sales returns – R5 000; Rental income – credit R32 500; Stationery – R3 500; Bank charges – R300; Insurance – R6 750; Wages and salaries – R48 000; Water and electricity – R24 000; Telephone expenses – R36 000; Settlement discount granted – R700; Settlement discount received – credit R900; Advertising – R4 800; Credit losses – R2 000. Both the debit and credit columns total R2 504 050. The following additional information must also be taken into account: (a) a physical inventory count performed on 28 February 2014 showed inventory on hand of R52 000 and stationery on hand of R500; (b) the account of Mrs A Singh for R1 500 must be written off as irrecoverable and an allowance for credit losses of R3 000 must be created; (c) depreciation must be provided at 10% per annum on the straight-line method on equipment and at 20% per annum on the reducing-balance method on vehicles; (d) on 1 October 2013 RG Stores agreed to rent out a section of its building to a customer at a monthly rental of R6 500 payable on the 1st of every month – the tenant paid R32 500 to RG Stores on 1 November 2013 but only took occupation of the building on 1 December 2013; (e) the insurance figure includes a prepaid amount of R1 350; and (f) a water and electricity account of R1 500 remains outstanding as at 28 February 2014. Using the pre-adjustment trial balance and additional information (a) to (f) given for RG Stores, prepare the statement of changes in equity for RG Stores for the year ended 28 February 2014.Show the full question

FAC1501 May/Jun 2014 thread

Stuck on a question, or worked one out? This thread is for this paper only. Anyone can read; sign in to post.

Nobody has posted on this paper yet. Be the first — say which question and what you got.

0/2000

The full Spot Map and the marks by year — and this paper’s scan.