Web viewShares issued during the year at R12 each. Shares bought back ... Give ONE word/term for...
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Directorate: Curriculum FET ACCOUNTING Grade 12 Revision Companies: Preparation of financial statements Answer Book
Transcript of Web viewShares issued during the year at R12 each. Shares bought back ... Give ONE word/term for...
Directorate: Curriculum FET
ACCOUNTING
Grade 12 Revision
Companies: Preparation of financial statements
Answer Book
Accounting Revision
Activity 1: (Taken from March 2015)
1.1 Choose a description from COLUMN B that matches a term/concept in COLUMN A. Write only the letter (A–E) next to the question number (1.1.1–1.1.5).
1.1.1
1.1.2
1.1.3
1.1.4
1.1.5 5
1.2.1 ORDINARY SHARE CAPITALAuthorised: 1 000 000 ordinary shares
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Issued:
RETAINED INCOME
Balance on 1 July 2013
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Ordinary share dividends
Balance on 30 June 2014TRADE AND OTHER RECEIVABLESNet trade debtors
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2
Accounting Revision
1.2.2 BARGAIN TRADERS LTDBALANCE SHEET ON 30 JUNE 2014
ASSETSNON-CURRENT ASSETS
Fixed/Tangible assets
CURRENT ASSETS
TOTAL ASSETS
EQUITY AND LIABILITIES
SHAREHOLDERS' EQUITY
Ordinary share capitalRetained income
NON-CURRENT LIABILITIES
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Loan: Drake Bank
CURRENT LIABILITIES
Trade and other payables
TOTAL EQUITY AND LIABILITIES
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Accounting Revision
1.2.3 Calculate the net asset value (NAV) per share on 30 June 2014.
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1.2.4 Comment on the price offered for the shares that were repurchased. Quote relevant financial indicators (actual figures/ ratios/percentages) to support your comment.
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1.2.5 Calculate Kyle Mason's percentage shareholding after the proposed share buy-back on 31 August 2014.
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As a shareholder, explain your concern regarding the proposed repurchase of shares.
Provide TWO questions you would ask the directors at the annual general meeting.
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4
TOTAL MARKS
75
Accounting Revision
Activity 2: (Taken from June 2015)
2.1 Write only the letter (A–E) next to the question number.
2.1.12.1.2
2.1.3
2.1.4 4
2.2.1 See Income Statement on the next page.
2.2.2 Ordinary Share Capital Note
Authorised1 000 000 ordinary shares
IssuedShares in issue on 1 Mar. 2014Shares issued during the year at R12 eachShares bought back (average issued price of _______)Shares in issue on 28 Feb. 2015
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2.2.3 Retained Income Note
Balance at beginning of financial year
Dividends
Balance at end of financial year
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Accounting Revision
2.2.1 PRINCE LIMITED
INCOME STATEMENT FOR THE YEAR ENDED 28 FEBRUARY 2015SalesCost of sales (14 974 000)Gross profitOther income
Gross operating incomeOperating expensesAuditors’ fees 147 600Advertising 960 000
Operating profit
Income tax (540 000)
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TOTAL MARKS
65
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Accounting Revision
Activity 3: (Taken from November 2012)
3.1 Choose a description from COLUMN B that matches the term in COLUMN A. Write only the letter (A–D) next to the question number (3.1.1–3.1.4).
3.1.1
3.1.2
3.1.3
3.1.44
3.2 MASTER LIMITED
3.2.1 NOTE TO THE BALANCE SHEET ON 30 JUNE 2012
FIXED/TANGIBLE ASSETS LAND AND BUILDINGS
EQUIPMENT VEHICLES
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Carrying value – 1 July 2011 R 930 000 R 220 000 R 519 200
Cost 930 000 561 000 814 000
Accumulated depreciation 0 (341 000) (294 800)
Movements
Additions at cost * * 0
Disposal at carrying value 0 0 *
Depreciation 0 * (98 890)
Carrying value – 30 June 2012 1 580 000 * *
Cost 1 580 000 616 000 *
Accumulated depreciation 0 * *
3.2.2 Calculate the Retained Income on 30 June 2012. (You may prepare an Appropriation Account if you wish.) 11
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Accounting Revision
3.2.3 MASTER LIMITED – BALANCE SHEET ON 30 JUNE 2012
ASSETS
Non-current assets
Fixed/Tangible assets
Current Assets
Inventories
TOTAL ASSETS
EQUITY AND LIABILITIES
Ordinary shareholders' equity
Ordinary share capital
Retained income
Non-current liabilities
Current liabilities
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Accounting Revision
TOTAL EQUITY AND LIABILITIES
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9
Accounting Revision
Activity 4: (Taken from November 2013)
:4.1 Give ONE word/term for each of the descriptions by choosing a word/term from the list. Write only the word/term next to the question number (4.1.1–4.1.4).
4.1.1
4.1.2
4.1.3
4.1.48
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Accounting Revision
4.2 SELATI LIMITED4.2.1 INCOME STATEMENT FOR THE YEAR ENDED 30 JUNE 2013
SalesCost of sales (8 200 000)
Gross profitOther income
Gross operating incomeOperating expenses (3 348 420)
Salaries and wages
Directors’ fees
Audit fees
Employer’s contribution (Pension and UIF)
Operating profit
Profit before interest expense
Net profit before tax
Net profit after tax 588 000
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Accounting Revision
4.2.2 NOTE FOR RETAINED INCOME
Balance at the beginning of the year 735 000
Net profit after tax
Balance at the end of the year 11
4.3 AUDIT REPORT
As a shareholder, why would you be concerned about this audit report? Explain. State THREE points.
Point 1
Point 2
Point 3
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TOTAL MARKS
75
12
Accounting Revision
Activity 5: (Taken from November 2014)5.1 5.1.
1SHARE CAPITAL
AUTHORISED SHARE CAPITAL
750 000 ordinary shares
ISSUED SHARE CAPITAL
________ Ordinary shares in issue on 1 March 2013
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80 000 Ordinary shares issued during the year
(75 000) Ordinary shares re-purchased(average price of _______)
________ Ordinary shares in issue on 28 February 2014
5.1.2
RETAINED INCOME
Balance on 1 March 2013 322 500
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Ordinary share dividends
Balance on 28 February 2014
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Accounting Revision
5.2
VIJAY LIMITED
BALANCE SHEET (STATEMENT OF FINANCIAL POSITION) ON 28 FEBRUARY 2014
ASSETS
Non-current assets
Financial asset: Fixed deposit 650 000
Current assets
Inventories 275 400
Trade and other receivables
Cash and cash equivalents 336 600
TOTAL ASSETS
EQUITY AND LIABILITIES
Shareholders’ equity
Non-current liabilities
Current liabilities
TOTAL EQUITY AND LIABILITIES
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Accounting Revision
5.3 Calculate the return on average shareholders’ equity for 2014.
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5.4 From 2013 to 2014 the directors made a deliberate decision to change the policy on the distribution of profits in the form of dividends. Comment on this change. Quote financial indicators or figures to support your answer.
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5.5 Comment on whether the shareholders should be satisfied with the percentage return and the market price of their shares. Quote TWO relevant financial indicators (actual figures/ratios/percentages) and their trends. Give an additional comment in each case.
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Accounting Revision
5.6 The external auditors, Hassan and Jacob, have employed Janet to work on the audit of Vijay Ltd. Janet owns 10 000 shares in Vijay Ltd.
Explain why this is a problem.
Give a valid solution.
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TOTALMARKS
65
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Accounting Revision
Activity 6: (Taken from November 2015)
6.1 PRIDONA LIMITED
6.1.1 Calculation of the correct net profit after tax
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Incorrect net profit 2 493 600
Correct net profit before taxIncome tax
Net profit after tax
6.1.2 RETAINED INCOME NOTE ON 30 JUNE 2015
Balance at beginning of year 2 700 000
Dividends
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Accounting Revision
6.1.3 PRIDONA LIMITEDBALANCE SHEET AS AT 30 JUNE 2015ASSETS
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NON-CURRENT ASSETS 8 950 000
Fixed assets at carrying value 8 950 000
CURRENT ASSETS
InventoriesTrade and otherReceivablesCash and cash equivalents
TOTAL ASSETS
EQUITY AND LIABILITIES
ORDINARY SHAREHOLDERS' EQUITY
Ordinary share capital 5 572 000
Retained income
NON-CURRENT LIABILITIES
CURRENT LIABILITIESTrade and otherPayables
TOTAL EQUITY AND LIABILITIES
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Accounting Revision
6.2 AUDIT REPORT
6.2.1 Choose the correct word from those given in brackets.
Give a reason.
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6.2.2 Explain TWO consequences of this audit report for the company and/or the CEO.
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TOTAL MARKS
60
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