Question 1: Refer to the following transactions entered into by TH Traders during the year ended 30 June 2012 and answer the question that follow:
| Transaction | |
| 1. | The owner deposited R 60 000 into business account as his contribution to the business |
| 2. | Sold goods on credit to F Meko, R 7 000 |
| 3. | The business obtained a loan of R30 000 from FNB. |
| 4. | Bought stationery on credit, R300 |
| 5. | Cash sales of goods, R6 500. The goods were bought for R4 000 |
| 6. | Purchased furniture and equipment on credit from FBD Ltd R5 000 |
| 7. | The owner used a business cheque to pay for his personal accounts, R4 000 |
| 8. | Purchased Equipment worth R60 000. R42 000 was paid using cash and the remainder will be paid in 3 months’ time. |
REQUIRED:
Record the above transactions using the Accounting Equation. Use the following format to answer this question:
Example: Paid for advertising R300.
| TRANSACTION | ASSETS | = | EQUITY | + | LIABILITIES |
| Example | -300 | -300 | 0 | ||
Question 2: The following is a trail balance of ACC Limited for the year ended 31 December 2014:
| R | |
| BALANCE SHEET ACCOUNTS | |
| Capital | 250 000 |
| Drawings | 4 400 |
| Land and buildings (at cost) | 180 000 |
| Vehicles (at cost) | 120 000 |
| Furniture (at cost) | 15 000 |
| Bank | 5 900 |
| Debtors | 40 140 |
| Stock ( 1/01/2014) | 4 000 |
| Creditors | 50 750 |
| Accumulated Depreciation: Vehicles | 26 000 |
| Accumulated Depreciation: Furniture | 3 000 |
| NOMINAL ACCOUNTS | |
| Sales | 252 145 |
| Sales returns | 615 |
| Commission Income | 670 |
| Rent received | 1950 |
| Purchases | 170 550 |
| Purchases Returns | 550 |
| Bad Debts/credit losses | 230 |
| Insurance | 2 750 |
| Packing material | 800 |
| Salaries | 38 500 |
| Water and electricity | 3300 |
Additional information:
Inventory on 31 December 2014 : Trading inventory R6 500
Packing Material R175
- Debtor Jacob is His debt of R140 has been written off as irrecoverable
- Provision must be made for depreciation as follows:
- Vehicles 20% on diminishing balance method/reducing
- Furniture 10% Straight Line
- A Debtor, Mr Fletcher who wed R230 finally managed to pay his debt that was previously written off as irrecoverable in This was not considered in the above trail balance.
REQUIRED:
Prepare the Statement of Comprehensive Income for ACC Limited for the year ended 31 December 2014.
Question 3:
The following transactions occurred in the books of Pay n Pick limited for the month of April 2015:
| 1 April Purchases | 10 000 units @ R1,20 |
| 10 April Purchases | 12 000 units @ R1,50 |
| 15 April Sales | 25 000 @ R3,00 |
| 20 April Purchases | 8 000 @ R1,80 |
| 23 April Sales | 10 000 units @ R3,30 |
Additional Information:
The stock count at 31 March 2015 revealed that 10 000 units at a cost of R1 per unit were on hand.
REQUIRED:
- Calculate closing stock at 30 April 2015 using First in First out (FIFO). (20)
- Calculate Cost of sales at 30 April (5)
- Calculate how much gross profit Pay n pick made in the month of (5)
Answers to Above Questions on Accounting
Answer 1: The recording of all the transactions using accounting equation is performed as follows:
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