Centre Number Candidate Number Candidate Name

NAMIBIA SENIOR SECONDARY CERTIFICATE

ACCOUNTING ORDINARY LEVEL 4345/2

PAPER 2 2 hours
Marks 100 2021

Additional Materials: Non-programmable calculator

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INSTRUCTIONS AND INFORMATION TO CANDIDATES

V
• Candidates answer on the Question Paper in the spaces provided.

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• Write your Centre Number, Candidate Number and Name in the spaces at the top of this page and

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on all separate answer sheets used.
• Write in dark blue or black pen.

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• You may use a soft pencil for any rough work, diagrams or graphs. For Examiner’s Use
• Do not use correction fluid.

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1
• Do not write in the margin For Examiner’s Use.

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• You may use blank pages for calculations/when answers are crossed 2
out and corrected.
3

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• Answer all questions.

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• The number of marks is given in brackets [ ] at the end of each

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question or part question. 5

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• You may use a non-programmable calculator. 6
• Where layouts are to be completed, you may not need all the lines

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for your answer.
• The businesses mentioned in this question paper are entirely fictitious.
Total

Marker
Checker

This document consists of 16 printed pages and 4 blank pages.

Republic of Namibia
MINISTRY OF EDUCATION, ARTS AND CULTURE
© MoEAC/DNEA 4345/2/21 [Turn over
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 2 For
Examiner's
1 Henco owns a paint store. His financial year ends on 30 June. Use

He provided the following information:

His debtors (trade receivables) on 1 July 2019 included N$700 owed by Gerda.
On 30 June 2020 Gerda paid half of the amount owing in cash and the balance
was written off as a bad debt.

On 15 January 2021 Gerda paid the outstanding amount in cash.

REQUIRED
(a) Make the appropriate entries for the financial years ended 30 June 2020
and 30 June 2021 in each of the following ledger accounts. The accounts
should be balanced or closed off at the end of each year.
(i) Gerda's account
Gerda's account

[3]
(ii) Bad debts account
Bad debts account

[2]
(iii) Bad debts recovered account
Bad debts recovered account

[2]

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For
Examiner's
Henco maintains a provision for doubtful debts at 4% of the total debtors (trade Use
receivables) at the end of each financial year.

The provision for doubtful debts on 1 July 2019 was N$128.

His debtors (trade receivables) owed N$2 800 on 30 June 2020 and N$4 000 on
30 June 2021.

REQUIRED
(b) Write up the provision for doubtful debts account for each of the financial
years ended 30 June 2020 and 30 June 2021.
Provision for Doubtful Debts account

[5]
(c) State and explain two accounting principles which Henco applied by
maintaining a provision for doubtful debts.
1.....................................................................................................................

.......................................................................................................................

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2.....................................................................................................................

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....................................................................................................................... [4]

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Examiner's
(d) State two ways in which Henco could calculate his provision for doubtful Use
debts instead of using a percentage of the total debtors (trade receivables).
1.....................................................................................................................

.......................................................................................................................

2.....................................................................................................................

....................................................................................................................... [2]

Henco would like to reduce the amount of bad debts.

REQUIRED
(e) Suggest two ways how Henco can reduce his bad debts.
1.....................................................................................................................

.......................................................................................................................

2.....................................................................................................................

....................................................................................................................... [2]

[20]

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BLANK PAGE

Question 2 on page 6

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2 The Otji Bird Club was established some years ago.
In addition to providing facilities to members the club also sells clothing to
members. Members select goods from a catalogue and pay cash. The club is
able to purchase these goods from a warehouse on credit terms. No stock is
held by the club.

The following information was provided on 1 October 2020.

N$
Equipment at book value (cost N$12 000) 9 000
Subscriptions due from members 150
Creditors (Trade payables) for clothing 60
General expenses owing 110
Insurance prepaid 50
The following is the receipts and payments account of the Otji Bird Club for the
year ended 30 September 2021.

Otjo Bird Club

Receipts and Payments Account for the year ended 30 September 2021
N$ N$
Balance Creditors (Trade payables)
(1 October 2020) 4 700 for clothing 2 620
Subscriptions 4 000 General expenses 2 460
Clothing sales 3 000 Insurance 620
Equipment 2 800
Balance
(30 September 2020) 3 200
11 700 11 700

The following additional information is provided.

1. On 30 September 2021 insurance prepaid amounted to N$60.
2. The equipment is depreciated at the rate of 5% per annum on the cost price
of equipment owned at the end of the financial year.
3. Nothing was owed to creditors (trade payables) for clothing at the end of the
financial year.

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For
Examiner's
REQUIRED Use
(a) Prepare the income and expenditure account of the Otji Bird Club for the
year ended 30 September 2021.
Otji Bird Club
Income and Expenditure Account for the year ended 30 September 2021

[8]
(b) State two ways in which an income and expenditure account differs from a
receipts and payments account.
1.....................................................................................................................

.......................................................................................................................

.......................................................................................................................

.......................................................................................................................

2.....................................................................................................................

.......................................................................................................................

.......................................................................................................................

....................................................................................................................... [4]

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Examiner's
The treasurer of the Otji Bird Club is concerned about the fall in the club’s bank Use
balance over the last few years.

REQUIRED
(c) Suggest four ways in which the club could increase its bank balance.
1.....................................................................................................................

.......................................................................................................................

2.....................................................................................................................

.......................................................................................................................

3.....................................................................................................................

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4.....................................................................................................................

....................................................................................................................... [4]

[16]

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BLANK PAGE

Question 3 on page 10

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Examiner's
3 Drew and Maya are in a partnership, sharing profits and losses equally. Use

Their balance sheet (statement of financial position) on 31 July 2021 is summarised

as follows.
N$
Assets other than cash 70 000
Cash 5 000
75 000
Capital: Drew 40 000
Maya 35 000
75 000
Drew and Maya are considering to either forming a close corporation or
admitting a new partner.

REQUIRED
(a) Advise Drew and Maya of two reasons why it could be better to form a close
corporation instead of a partnership.
1.....................................................................................................................

.......................................................................................................................

.......................................................................................................................

.......................................................................................................................

2.....................................................................................................................

.......................................................................................................................

.......................................................................................................................

.......................................................................................................................

....................................................................................................................... [4]
(b) Advise Drew and Maya why the goodwill of the business should be taken
into consideration if a new partner is to be admitted.
.......................................................................................................................

.......................................................................................................................

.......................................................................................................................

....................................................................................................................... [2]

On 1 August 2021 Drew and Maya decided to admit Arno to the partnership on
the following terms.
1. Goodwill was valued at N$15 000. It was decided that a goodwill account
would not to be maintained in the books of the partnership.
2. Arno agreed to contribute N$20 000 cash as his capital.
3. Drew, Maya and Arno agreed that profit and losses would be shared 2:2:1
respectively.
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For
Examiner's
REQUIRED Use
(c) Draw up the following accounts to record the admission of Arno to the
partnership. Balance or close the accounts off at the end of the month.
(i) Goodwill account
Goodwill account

[5]
(ii) Capital accounts
Capital accounts

[9]

[20]
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4 Errol Muju’s business has two departments.
He provided the following information on 31 May 2021.
Department A Department B Total
N$ N$ N$
Sales 90 000 45 000
Stock (Inventory) 1 June 2020 5 000 4 500
Stock (Inventory) 31 May 2021 ? ?
Purchases 52 000 30 500
Carriage inwards 300 100
Salaries 14 000 16 500
Rent expense 4 700
Advertising 600
General expenses 2 600
Equipment at cost 9 000

The expenses are to be apportioned equally between the two departments except
for salaries (which are to be charged as shown above) and advertising which is
to be shared in proportion to the sales of each department.

The gross profit margin is 40%.

The following additional information is provided.

1. An account for general expenses, N$240, for May 2021 had been received
but not yet paid.
2. Rent prepaid on 31 May 2021 amounted to N$360.
3. The equipment is to be depreciated by N$900.
REQUIRED
(a) Prepare a departmental trading and profit and loss account of Errol Muju for
the year ended 31 May 2021 to show the gross profit and net profit earned
by each department.
Total columns are not required.
The value of the stocks (inventory) on 31 May 2021 should be clearly shown.

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For
Examiner's
Errol Muju Use
Departmental Trading and Profit and Loss Account for the year ended
31 May 2021

[15]
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Examiner's
(b) State two reasons why it is useful for Errol to know the results of each Use
department of the business.
1.....................................................................................................................

.......................................................................................................................

2.....................................................................................................................

....................................................................................................................... [2]
(c) Advise Errol on three ways in which he could improve the results of the less
profitable department.
1.....................................................................................................................

.......................................................................................................................

.......................................................................................................................

.......................................................................................................................

2.....................................................................................................................

.......................................................................................................................

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3.....................................................................................................................

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....................................................................................................................... [6]

[23]

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Question 5 on page 16

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5 Danielle Meyer is a sole trader. She has very little knowledge of bookkeeping,
but attempted to prepare a trial balance and financial statements.
The following balance sheet (statement of financial position) was prepared
by her.
Balance Sheet (Statement of Financial Position) as at 30 June 2021
N$
Fixed assets at cost 40 000
Debtors (Trades receivable) 6 100
Creditors (Trade payables) 5 200
Bank overdraft 2 010
Stock (Inventory) 8 500
61 810

Capital 34 000
Provision for depreciation of fixed assets 8 000
Net profit for the year 8 440
Drawings 7 300
57 740
Difference 4 070
61 810

The following errors were discovered after the preparation of the financial
statements.
1. No adjustment had been made for expenses prepaid at 30 June 2021
amounting to N$30.
2. The bank statement received on 30 June 2021 showed that the bank had
debited the business's bank account with N$70 for interest charged on the
overdraft. No adjustment had been made for this in Danielle Meyer's books.
3. The total of the discount received column in the cash book, amounting to
N$150, had not been transferred to the discount received account in the
ledger. Because of this, discount received did not appear in either the trial
balance or the Profit and Loss Account.
4. Fixed assets costing N$5 000 had been sold during the year ended
30 June 2021. Depreciation of N$500 had been provided up to the date
of sale. The amount received for the assets, N$4 100, had been correctly
entered in the cash book, but no other entries had been made.

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For
Examiner's
REQUIRED Use

Prepare a corrected balance sheet (statement of financial position) for Danielle

Meyer as at 30 June 2021.

Danielle Meyer
Balance Sheet (Statement of Financial Position) as at 30 June 2021

[11]

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Examiner's
6 Collin is a trader. He employs staff to maintain his accounting records. Use

The following account appeared in Collin's general ledger.

Dr Rent expense account Cr

N$ N$
2020 2020
Dec 31 Bank 5 040 June 1 Balance b/d 340
2021
May 31 Profit and Loss 4 340
Balance c/d 360
5 040 5 040
2021
June 1 Balance b/d 360

The alternative presentation of the account is as follows.

Rent expense account

Debit Credit Balance
N$ N$ N$
2020
June 1 Balance b/d 340 340

Dec 31 Bank 5 040 4 700

2021
May 31 Profit and Loss 4 340 360

REQUIRED
(a) Explain each entry in the rent expense account.
1. 1 June 2020, Balance

................................................................................................................

................................................................................................................

................................................................................................................

2. 31 December 2020, Bank

................................................................................................................

................................................................................................................

................................................................................................................

3. 31 May 2021, Profit and loss

................................................................................................................

................................................................................................................

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For
Examiner's
4. 31 May 2021, Balance Use

................................................................................................................

................................................................................................................

................................................................................................................ [4]

Collin wanted to exclude the entry indicated as a balance on 31 May 2021 so that
his rent expense is less for the year.

REQUIRED
(b) Advise Collin on the effect this exclusion would have had on the profit of the
business.
.......................................................................................................................

.......................................................................................................................

.......................................................................................................................

....................................................................................................................... [2]

The following errors were discovered in the debtors ledger.

1. Cash received from Carmen Sawyer was correctly entered in the cash
book but had been credited to the account of Carmen Sauer.
2. A cheque received from Sandy Crowley was correctly entered in the cash
book but had been debited to Sandy Crowley's account.

REQUIRED
(c)  (i) State which error will require a correcting entry in a suspense account.
Give a reason for your answer.
Error number ..........................................................................................

Reason . .................................................................................................

................................................................................................................

................................................................................................................ [2]
(ii) State which error does not require a correcting entry in a suspense
account. Name the type of error made.
Error number...........................................................................................

Type of error............................................................................................

................................................................................................................ [1]

[9]

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BLANK PAGE

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permission from the copyright holder. The Namibian Government Copyright Act allows copyright material to be used limitedly and fairly
for educational and non-commercial purposes.

The Directorate of National Assessment and Examinations operates under the auspices of the Ministry of Education, Arts and Culture
in Namibia.

© MoEAC/DNEA 4345/2/21

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