QUESTION 1 (BANK RECONCILIATION) The following information is available after the Cash Book of Windhoek Stores was compared with their Bank Statement at 28 February 2010. Information The Cash Book showed an overdraft of N$10 100. The Bank Statement showed a debit balance of N$10 568. The deposit of N$7 654 does not appear on the Bank Statement. Cheques not yet presented for payment: Nr. 511 N$805 Nr. 516 N$690 The bank recorded the following in the current bank account of Windhoek Stores: Credit card levy N$150 Service fee N$243 Interest on overdraft N$163 A cheque for N$260 received from P. Peters was dishonoured by the bank. Discount allowed on this cheque was N$30. A payment by a debtor, D. Sunshine, for N$3 000 appears in the Bank Statement and not in the Cash Book. The Bank Statement showed a debit order for N$693 in favour of Deadsure for an insurance premium. T. Strong, a tenant, deposited his monthly rent directly into the bank account, N$4 200. You are required to: 1.1 Make supplementary entries in Cash Book of Windhoek Stores on 28 February 2010. (17) 1.2 Draw up the Bank Reconciliation Statement on 28 February 2010. (8)
MEMORANDUM: QUESTION 1 CASH BOOK OF WINDHOEK STORES FEBRUARY 2010 CB2 DOC DAY DETAILS BANK DOC DAY DETAILS BANK B/S 28 D. SUNSHINE 3 000 28 BALANCE 10 100 B/D B/S RENT INCOME 4 200 B/S BANK CHARGES 393 (150+243) B/S BALANCE 4 409 B/S INTEREST ON 163 C/D OVERDRAFT B/S INSURANCE 693 B/S P. PETER (R/D) 260 11 609 11 609 MARCH 2009 CB3 1 BALANCE 4 409 BANK RECONCILIATION STATEMENT AS AT 28 FEBRUARY 2010. CREDIT BALANCE ACCORDING TO CASH BOOK 4409 LESS: UNPRESENTED CHEQUES: NO 511 805 516 690 1 495 2914 ADD: OUTSTANDING DEPOSIT 7 654 DEBIT BALANCE ACCORDING TO BANK STATEMENT 10568
QUESTION 2 (TRIAL BALANCE) The following balances were taken from the books of John s General Stores on 31 December 2010. N$ Stock (1 January 2010) 12 000 Sales 105 400 Bank (dr) 6 000 Debtors 13 000 Rent Income 9 600 Equipment 70 000 Returns Outwards 1 800 Purchases 68 500 Insurance 3 500 Creditors 8 800 Capital? Required: Prepare a Trial Balance for John s General Stores as at 31 December 2010. (12) MEMORANDUM: QUESTION 2 Trial Balance of John s General Stores as at 31 December 2010 fol Debit Credit BALANCE SHEET SECTION N$ NS CAPITAL 47 400 STOCK 12 000 BANK 6 000 DEBTORS 13 000 EQUIPMENT 70 000 CREDITORS 8 800 NOMINAL ACCOUNTS SALES 105 400 RENT INCOME 9 600 RETURNS OUTWARDS 1 800 PURCHASES 68 500 INSURANCE 3 500 173 000 173 000 No totals or Capital calculation 0. (List) Sections left out 2.
QUESTION 3 (WAGES JOURNAL) Required: Use the following information and draw up the Wages Journal of USA Traders for the week ending 21 March 2010. Close off the Wages Journal and post it to the given accounts in the General Ledger. A normal working week is 40 hours. Employees Hours worked Rate normal time Rate overtime Deductions PAYE Pension Social Security 15 % of 9% of N$21 Gross Normal wage wage S Knowall 52 N$40 1½times P Nobody 48 N$30 normal N$14 time rate (31)
MEMORANDUM: QUESTION 3 Wages Journal of USA Traders for the week ending 21 March 2010 WJ Details Normal Time Overtime Gross Pension PAYE Social Total Net Wages wages Security Deductions Hours Rate Amount Hours Rate Amount S Knowall 40 40 1 600 12 60 720 2 320 144 348 21 513 1 807 P Nobody 40 30 1 200 8 45 360 1 560 108 234 14 356 1 204 2 800 1 080 3 880 252 582 35 869 3 011 GL7 GL6 GL5
General Ledger of USA Traders Dr Creditors for Wages GL5 Cr 2010 MAR 21 WAGES WJ 3 011 Pension Fund GL6 2010 MAR 21 WAGES WJ 252 2010 MAR 21 GROSS WAGES WJ Wages 3 880 GL7
QUESTION 4 (ACCOUNTING EQUATION) Analyse the given transactions on the answer sheet. Show an increase with a (+), a decrease with a (-) and no effect with (0). Give the amount concerned in each case. TRANSACTIONS: 1. Goods sold on credit to A. Anna, N$600. 2. A Anna returned damaged goods, N$250, issued credit note. 3. Purchased stock on credit, N$7 000 from ABC Traders. 4. The owner, B. Bennie, provide a vehicle as part of his capital contribution, N$280 000. 5. Tax deducted from employees in the Wages Journal for the month was N$2 500. Sent a cheque to the Receiver of Revenue(PAYE) for the amount deducted. 6. Purchased stationery, N$300, paid from Petty Cash. 7. Interest on fixed deposit received and deposited into the bank account, N$400. (28) MEMORANDUM: QUESTION 4 EFFECT ON ACCOUNT DEBITED ACCOUNT CREDITED A O E L 1 A ANNA SALES +600 +600 0 2 RETURNS INWARDS A ANNA -250-250 0 3 PURCHASES ABC TRADERS 0-7 000 +7 000 4 VEHICLES CAPITAL +280 000 +280 000 0 5 RECEIVER OF REVENUE (PAYE) BANK -500 0-500 6 STATIONERY PETTY CASH -300-300 0 7 BANK INTEREST ON FIXED DEPOSIT +400 +400 0
QUESTION 5 (RATIO S) The following amounts were taken from the books of Tsumeb Stores on 30 July 2010. N$ Sales 250 000 Cost of Sales 175 000 Other Income 5 000 Expenses 30 000 Fixed Assets 150 000 Investments 15 000 Current Assets (including stock) 30 900 Current Liabilities 9 000 Stock 8 000 Long-term Liabilities 60 000 Opening Capital 126 900 Calculate to two decimal places: 5.1 Mark-up [3] 5.2 Margin [2] 5.3 Solvency [6]
5.4 Quick ratio [4] 5.5 ROCE [4] MEMORANDUM: QUESTION 5 5.1 Mark-up [3] GP% of Cost of Sales = 75 000 175 000 x 100% = 42,86% 5.2 Margin [2] GP% of Sales = 75 000 250 000 x 100% = 30% 5.3 Solvency [6] Solvency = Total Assets : Total Liabilities = (150 000 + 15 000 + 30 900) : (60 000 + 9 000) = 195 900 : 69 000 = 2.84 : 1
5.4 Quick ratio [4] (Current assets stock) : Current liabilities = (30 900 8000) : 9000 = 22 900 : 9 000 = 2.54 : 1 5.5 ROCE [4] Net Profit Opening capital x 100% = 50 000 126 900 x 100% = 39.40%