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$4 200.
You are required to:
1.1 Make supplementary entries in Cash Book of Windhoek Stores on
28 February 2010. (17) 1.2 Draw up the Bank Reconciliation Statement on 28 February 2010. (8)
MEMORANDUM: QUESTION 1
CASH BOOK OF WINDHOEK STORES – FEBRUARY 2010 CB2
DOC DAY DETAILS BANK DOC DAY DETAILS BANK
B/S 28 D. SUNSHINE 3 000 28 BALANCE B/D 10 100 B/S RENT INCOME 4 200 B/S BANK CHARGES (150+243) 393 B/S BALANCE C/D 4 409 B/S INTEREST ON OVERDRAFT 163 B/S INSURANCE 693 B/S P. PETER (R/D) 260 11 609 11 609 MARCH 2009 CB3 1 BALANCE 4 409
BANK RECONCILIATION STATEMENT AS AT 28 FEBRUARY 2010.
CREDIT BALANCE ACCORDING TO CASH BOOK 4409 LESS: UNPRESENTED CHEQUES: NO 511 805
516 690 1 495 2914
ADD: OUTSTANDING DEPOSIT 7 654
The following balances were taken from the books of John’s General Stores on 31 December 2010. N$ 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
No totals or Capital calculation – 0. (List) Sections left out – 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
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 PAYE Pension Deductions Social Security S Knowall 52 N$40 1½times normal time rate 15 % of Gross wage 9% of Normal wage N$21 P Nobody 48 N$30 N$14 (31)
MEMORANDUM: QUESTION 3
Wages Journal of USA Traders for the week ending 21 March 2010 WJ
Details Normal Time Overtime Gross
wages
Pension PAYE Social Security
Total Deductions
Net Wages
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
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 Wages GL7 2010 MAR 21 GROSS WAGES WJ 3 880
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$400.
(28)
MEMORANDUM: QUESTION 4
ACCOUNT DEBITED ACCOUNT CREDITED A EFFECT ON O’E L
1 A ANNA SALES +600 +600 0
2 RETURNS INWARDS A ANNA -250 -250 0
3 PURCHASES ABC TRADERS 0 -7 000 +7 000
4 VEHICLES CAPITAL +280 000 +280 000 0
5 RECEIVER OF REVENUE
(PAYE) BANK -500 0
-500
6 STATIONERY PETTY CASH -300 -300 0
7 BANK
INTEREST ON FIXED
DEPOSIT +400 +400 0
QUESTION 5 (RATIO’S)
The following amounts were taken from the books of Tsumeb Stores on 30 July 2010.
N$ 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]
5.5 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% Use 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 126900 𝑥 100% = 39.40%
