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  

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

    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  

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    

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  

  4.6 Fill in the missing words (2)       Building structures to protect the coast is called _____engineering whilst working with natural processes is called _____ engineering.  

  3.8 From the Cutty Sark, you look downstream. In which direction is the river flowing? (5)

EXTRA ESSAY QUESTION (USE ONLY IF NECESSARY)

  4.2 Match the columns with the correct term (5)