2 NW NSC Accounting P1 Eng Ab Sept 2023

NAME:
NATIONAL SENIOR CERTIFICATE
ACCOUNTING P1
GRADE 12
SEPTEMBER 2023
SPECIAL ANSWER BOOK
QUESTION MAX MARKS MARKS MODERATOR

AWARDED
1 60
2 35
3 40
4 15
TOTAL 150
This answer book consists of 10 pages.
Copyright reserved Please turn over

Accounting/P1 2 NW/September 2023
NSS – Answer book
QUESTION 1
1.1 Calculate the correct NET PROFIT AFTER TAX for the year ended
28 February 2023. You must indicate + or – for each adjustment.
Incorrect profit before tax R 3 686 800
Correct profit before tax
Net profit after tax

18
1.2 Prepare the following notes to the Statement of Financial Position

on 28 February 2023:
1.2.1 Ordinary share capital issued:
70 000 Shares issued at R40 each 2 800 000
(20 000) Shares repurchased at

NSS – Answer book
1.2.2 Retained income

Balance at the beginning 950 000
Repurchase of shares
Dividends
Recommended/Final
Balance end of year
8
1.3 COCO LIMITED

STATEMENT OF FINANCIAL POSITION ON 28 FEBRUARY 2023
Current assets
Cash and cash equivalents 15 000
EQUITY AND LIABILITIES
Ordinary shareholders’ equity
Non-current liabilities
Loan: Trouble Bank
(800 000
Current liabilities
Trade and other payables (250 000
Bank overdraft 90 000

Shareholders for dividends
Current portion of the loan
TOTAL EQUITY AND LIABILITIES 28
TOTAL
MARKS
60

NSS – Answer book
QUESTION 2
2.1 MUSIC LTD.

CASH FLOW STATEMENT FOR THE YEAR ENDED ON 30 JUNE 2023
CASH EFFECTS OF OPERATING ACTIVITIES 801 500
Cash generated from operations

Interest paid (175 500)
Income tax paid (425 000)

Dividends paid
534 000
CASH EFFECTS OF INVESTING ACTIVITIES
Fixed assets purchased (48 000)
Proceeds from disposal of fixed assets
CASH EFFECTS OF FINANCING ACTIVITIES
Change in loan (625 000)
NET CHANGE IN CASH AND CASH EQUIVALENTS

Cash and cash equivalents at beginning of the year 207 500
Cash and cash equivalents at end of the year

19
2.2 Explain why the shareholder, Ben, might be against the strategies of
selling fixed assets and the issuing of more shares. Provide TWO reasons
why Ben might be against EACH of these strategies.
Reasons against selling fixed assets
REASON 1
REASON 2
2
Reasons against issuing more shares
REASON 1
REASON 2

NSS – Answer book
2.3 Calculate the following financial indicators for the year ended
30 June 2023:
2.3.1 Acid-test ratio

CALCULATION ANSWER
2.3.2 Debt-equity ratio

CALCULATION ANSWER
2.3.3 Calculate: % return on average shareholders’ equity

CALCULATION ANSWER
TOTAL
MARKS
35

NSS – Answer book
QUESTION 3
3.1 Choose a term in COLUMN B that matches the description in

COLUMN A. Write only the letters (A–E) next to the question
numbers (3.1.1 to 3.1.5) in the ANSWER BOOK.
3.1.1
3.1.2
3.1.3
3.1.4
3.1.5 5
3.2 WILD LTD. AND FREE LTD.
3.2.1 Explain why you would feel that Wild Ltd is handling its liquidity
more effectively than Free Ltd. Quote THREE financial indicators
to support your opinion.
3.2.2  Compare and comment on the dividend pay-out policies of the

two companies with figures.
Comment/Explanation:

NSS – Answer book
3.2.2  Comment and explain on the % return on shareholders’ equity

of each company.
Explanation:
3.2.3 Comment on the gearing and risk of each company. Quote TWO
financial indicators with figures to support your opinion.
Relevant financial indicators:
Comment:

NSS – Answer book
3.2.4 Explain how the value of the shares for each company will
influence your decision in which company you would buy shares
or not.
Wild Ltd
Explanation:
Free Ltd
Explanation:
3.2.5 Calculate the maximum number of shares you could buy in lots
of 100 (i.e. 100 shares, 200 shares, etc.) in Wild Ltd.
CALCULATION ANSWER
2
A friend has told you to buy shares in the company which allows
you to buy the highest number of shares.
Explain why you would disagree with him.
Apart from the matters covered in the questions above, provide

TWO points that you would regard as more important in making
this decision.
TOTAL
MARKS
40
NSS – Answer book
QUESTION 4
4.1 Explain your understanding of corporate governance and indicate

who is responsible for the corporate governance of a company.
Explain your understanding of corporate governance:
Who is responsible for the corporate governance of a company?
4.2 Explain what is meant by ‘ACCOUNTABILITY’ and ‘RESPONSIBLE

MANAGEMENT’.
Explain why these factors are important for good corporate

governance.

NSS – Answer book
4.3 List the THREE different types of audit report. Identify which report
would undermine good corporate governance in a company and
provide your reason for choosing this report.
Types of audit report:
Which report would undermine good corporate governance:
Reason for choosing this report:
4.4 Explain why the auditors would not allow the directors to reflect
DIRECTORS FEES in the financial statements under SALARIES
AND WAGES.
TOTAL
MARKS
15
TOTAL: 150
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2 NW NSC Accounting P1 Eng Ab Sept 2023

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NAME:

NATIONAL SENIOR CERTIFICATE

SPECIAL ANSWER BOOK

QUESTION MAX MARKS MARKS MODERATOR

This answer book consists of 10 pages.

Copyright reserved Please turn over

Incorrect profit before tax R 3 686 800

Correct profit before tax

Net profit after tax

1.2 Prepare the following notes to the Statement of Financial Position

1.2.1 Ordinary share capital issued:

70 000 Shares issued at R40 each 2 800 000

(20 000) Shares repurchased at

Copyright reserved Please turn over

1.2.2 Retained income

1.3 COCO LIMITED

Cash and cash equivalents 15 000

EQUITY AND LIABILITIES

Ordinary shareholders’ equity

Bank overdraft 90 000

Copyright reserved Please turn over

2.1 MUSIC LTD.

Cash generated from operations

Income tax paid (425 000)

CASH EFFECTS OF FINANCING ACTIVITIES

Change in loan (625 000)

NET CHANGE IN CASH AND CASH EQUIVALENTS

Cash and cash equivalents at end of the year

Copyright reserved Please turn over

2.3.1 Acid-test ratio

2.3.2 Debt-equity ratio

2.3.3 Calculate: % return on average shareholders’ equity

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3.1 Choose a term in COLUMN B that matches the description in

3.2 WILD LTD. AND FREE LTD.

3.2.2  Compare and comment on the dividend pay-out policies of the

Copyright reserved Please turn over

3.2.2  Comment and explain on the % return on shareholders’ equity

Relevant financial indicators:

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Apart from the matters covered in the questions above, provide

4.1 Explain your understanding of corporate governance and indicate

Explain your understanding of corporate governance:

Who is responsible for the corporate governance of a company?

4.2 Explain what is meant by ‘ACCOUNTABILITY’ and ‘RESPONSIBLE

Explain why these factors are important for good corporate

Copyright reserved Please turn over

Types of audit report:

Which report would undermine good corporate governance:

Reason for choosing this report:

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