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1.2   GAAP PRINCIPLES: Study the adjustments above and choose the correct GAAP principle that is applied in each of the following adjustments. (5)   1.2.1 Adjustment 1       [OPTION1]     1.2.2 Adjustment 3       [OPTION2]     1.2.3 Adjustment 5       [OPTION3]     1.2.4 Adjustment 7       [OPTION4]     1.2.5 Adjustment 11       [OPTION5]         52

  B. Veranderinge in Kapitaalbydraes:       Die volgende transaksies is korrek geboekstaaf: ●       H. Pollard het op 1 November 2018 sy kapitaalbydrae met R250 000 verhoog. ●       Op 1 Desember 2018 het E. Jantjies sy kapitaal verminder met R150 000 . Die onderstaande transaksie is nie geboekstaaf nie: ●       Op 28 Februarie 2019, het H. Pollard sy kapitaal verminder met R50 000.         C. VERDELING VOLGENS DIE VENNOOTSKAPSOOREENKOMS:       Rente op Kapitaal: ●       Pollard is geregtig op 12% per jaar op sy kapitaalsaldo. ●       Jantjies is geregtig op R49 500 in totaal vir die jaar. Salaristoelaag: ●       Jantjies ontvang R144 000 vir die jaar. ●       Pollard se maandelikse salaris is R2 000 minder as Jantjies se salaris. Jaarlikse bonus: ●       Pollard ontvang ‘n jaarlikse bonus van R15 000. Finale verdeling van winste: ●       Die oorblywende wins van R16 000 word in die verhouding 3:2 tussen Pollard en Jantjies verdeel.     D. Die lening is op 1 Mei 2017 by FR Finkom aangegaan.  Die lening word terugbetaal in gelyke maandelikse paaiemente oor ‘n tydperk van 6 jaar.  Rente word nie gekapitaliseer nie en alle betalings, insluitend die huidige finansiële jaar is tot op datum betaal.     E. Besonderhede van ‘n werknemer wat uit Februarie 2019 se Salaris-joernaal weggelaat is:           Bruto Salaris Aftrekkings Werkgewersbydraes Netto Salaris Pensioen Fonds   WVF   SAID:  LBS TOTAAL Pensioen- fonds WVF R12 000 ? R120 ? R3 800 R1 440 R120 R8 200         ●       Die besigheid dra R1,50 vir elke R1 tot die Pensioenfonds by en R1 vir elke R1 aan WVF.  

INSTRUCTIONS   1. Read the following instructions carefully and make sure you follow them.   2. An ANSWER BOOK is provided in which you must answer all the relevant questions.   3. Show ALL calculations to earn part marks.           4. MAKE SURE YOU UPLOAD THE CORRECT ANSWER SHEET!!! INCORRECT UPLOADS =0   MAKE SURE YOU SAVE YOUR FILES CORRECTLY: ACCN GR11E T02 SBA004a YOUR SURNAME YOUR NAME YOUR DOCUMENT MUST BE IN PDF FORMAT.          5. You may use a non-programmable calculator.   6. If you choose to complete your exam by hand, make sure it is neat and legible.  Illegible handwriting = 0.   7. Make use of the time allocation provided for each question.  Try NOT to deviate from it.      SBA 004a GR 11 PAPER 1 AB.docx       SBA 004a GR 11 PAPER 1 AB.pdf        QUESTION TOPIC MARKS TIME 1 Partnerships:  Income Statement and GAAP principles 52 42 min 2 Partnerships: Balance sheet notes, Balance sheet extract and Accounting equation 61 48 min 3 Fixed assets: Concepts, Asset disposal and  Note for Fixed Assets 37 30 min     150 marks 120 min

  B. Changes to Capital contributions:       The following transactions were correctly recorded:   ●       On 1 November 2018 partner H. Pollard deposit R250 000 to increase his capital contribution. ●       On 1 December 2018 partner E. Jantjies decreased his capital by R150 000.   The following transaction was not recorded:   ●       On 28 February 2019, H. Pollard decreased his capital by R50 000.         C. Provisions of the partnership agreement:       Interest on capital: ●       Pollard is entitled to 12% p.a. on his capital balance. ●       Jantjies is entitled to R49 500 in total for the year.   Salary allowance: ●       Jantjies will receive R144 000 for the year. ●       Pollard’s monthly salary is R2 000 less than Jantjies.   Annual bonus: ●       Pollard receives an annual bonus of R15 000.   Share in remaining profit: ●       The remaining profit of R16 000 must be divided in the ratio 3:2 to Pollard and Jantjies respectively.     D. The loan from FR Finkom was received on 1 May 2017. It is to be repaid in equal monthly instalments over a period of 6 years. Interest is not capitalised, and all payments (including the current financial year) are up to date.     E. Details of an employee omitted from the February 2019 Salaries Journal are as follows:           Gross Salary Deductions Employers Contribution Net Salary Pension fund UIF SARS: PAYE TOTAL Pension fund UIF R12 000 ? R120 ? R3 800 R1 440 R120 R8 200         ●       The business contributes R1,50 for R1 to the Pension fund and R1 for R1 to UIF.  

  ADJUSTMENTS AND ADDITIONAL INFORMATION     1. Credit sales to D. Maslaba for R17 000 was not recorded. Cost of sales amounts to R10 000.       2. Stock on hand according to the physical stocktaking on 28 February 2019: ●       Trading stock, R70 900 ●       Packing material, R2 700     3. Depreciation on fixed assets amounts to R48 700 for the year.     4. N. Mokoena, a debtor, was declared insolvent. His outstanding balance of R4 500 must be written off as irrecoverable.     5. The provision for bad debts must be adjusted to R2 600.     6. The water and electricity account for February 2019 was received from the municipality, R1 600.  No entry was made.     7. Insurance expense includes an annual premium of R3 600 paid for the period 1 November 2018 to 31 October 2019.     8. The Bank statement from Bank of Africa reflected the following on 28 February 2019:       ●       Bank charges R745 and interest on current account R225.       ●       Unpaid cheque of a debtor (in settlement of a debt of R950)  R910     9. Interest on fixed deposit was only received for 9 months.  The fixed deposit was unchanged during the financial year. Interest is not capitalised.     10. Rent income includes rent for March 2019.  Note that rent was increased by 10% on 1 September 2018.     11. The loan statement received from the Bank of Africa:                   Balance on 1 March 2018 R 280 000 Capitalised interest             ? Repayments during the year including interest 95 000 Balance on 28 February 2019 220 000   Interest is capitalized.     12. Advertising consists of an annual contract with the newspaper for the entire financial year. Advertising was paid for 11 months only. From 1 November 2018, the contract rate was decreased by R450 per month.  

  NOMINAL ACCOUNTS SECTION         Sales   2 040 000     Cost of sales 1 200 000       Debtors allowances 36 700       Rent income   205 500     Salaries and wages 266 000       Pension Fund and UIF contributions 34 400       Bad debts 21 250       Water and electricity 53 900       Discount allowed 4 565       Telephone 29 700       Advertising 31 100       Insurance 48 600       Packing material 22 500       Bank charges 11 845       Interest on loan          ?       Interest on fixed deposit   27 000  

    Balances on 1 March 2015   Cost Accumulated depreciation Carrying value Land and buildings 400 000 ( 0) 400 000 Vehicles 300 000 (76 000) 224 000 Equipment 80 000 (20 000) 60 000       INFORMATION       Land and buildings       ●         Extension to the building at a cost of R120 000.       ●         Repairs to the store room amounts to R25 000       Vehicles       ●         Trade in an old vehicle at Jozi Motors on 1 September 2015 for R55 000.  This vehicle was bought on 1 March 2013 for R100 000.  The new vehicle was purchased on credit on the same day for R150 000.          ●         Depreciation on vehicles is calculated at 20% p.a. on the cost price / straight line method.       Equipment       ●         Kgosi Traders bought eight laptops at R6 000 each on 1 December 2015.       ●         Depreciation on equipment is calculated at 10% p.a on the diminishing balance method.           37 TOTAL 150  

2.2 ACCOUNTING EQUATION     Trevor and Mandy are partners of Trendy Clothes.     REQUIRED     Use the example below to analyse the transactions that follow.  Indicate an increase with +, a decrease with – and no change with 0.  Assume that the bank account balance is favourable at all times. (16)   Example: Paid the telephone account per cheque, R500.   No. Assets Equity Liabilities e.g. – 500 – 500 0             Transactions     2.2.1 Partner Mandy withdrew R4 800 trading stock from the business for her personal use.     2.2.2 Cash sales of R12 000. The mark-up is 60% on cost.     2.2.3 Paid his monthly salary per cheque to Trevor, R17 000.     2.2.4 Buy equipment on credit from ABC Wholesalers, R75 000.     2.2.5 A bonus of R10 000 is due to partner Trevor.         61

QUESTION 1:  INCOME STATEMENT  AND GAAP PRINCIPLES              (52 marks; 42 minutes)   1.1 MM TRADERS     Information from the records of MM Traders (with partners M. Malan and M. Mofokeng) for the financial year ended 28 February 2019 is provided.     REQUIRED:     1.1.1  Prepare the Income Statement (Statement of Comprehensive Income) for the financial year ended 28 February 2019. (47)   INFORMATION:     Optional:  RIGHT CLICK ON THE BUTTON AND OPEN IN A NEW TAB TO DOWNLOAD THE PRE-ADJUSTMENT TRIAL BALANCE           Extract from the Pre-Adjustment Trial Balance on 28 February 2019     BALANCE SHEET SECTION Debit Credit     Trading stock 81 500       Debtors control  892 450       Provision for bad debts (1 March 2018)   2 750  

QUESTION 2: BALANCE SHEET EXTRACT AND NOTES     (61 marks; 48 minutes)       2.1 PJ TRADERS     The information was extracted from the books of PJ Traders, with partners H. Pollard and E. Jantjies.  The financial year ended on 28 February 2019.     REQUIRED:     2.1.1 Prepare the following notes to the Balance Sheet for the financial year ended 28 February 2019:       ●       Capital (8)     ●       Current Accounts (12)     ●       Trade and other payables Note: Show all short-term liabilities except Bank Overdraft and current portion of loan in this note.   (11)   2.1.2 Complete the Equity and Liabilities section of the Balance Sheet on 28 February 2019. (14)   INFORMATION:       A. Balances from the ledger on 28 February 2019.             R Capital:  H. Pollard                     (1/2/2019) 600 000   Capital:  E. Jantjies                  (28/2/2019) 300 000   Current Account:  H. Pollard     (1/3/2018)      22 500 Cr Current Account:  E. Jantjies     (1/3/2018)     57 600 Dr Drawings:  H. Pollard 72 000   Drawings:  E. Jantjies 96 000   Loan:  FR Finkom 450 000   Creditors control  62 750   SARS: PAYE 13 500   Bank                                                           16 600 Cr Accrued expenses / Expenses payable 12 700   Income receive in advance 4 600   Accrued income / Income receivable 17 000   Prepaid expenses 16 300