Transaction 1 Workings Debit Credit

Workings Debit Credit

Dr Bank =250 000)+32 000 282 000
Cr Output tax =32000 *15/115 ) 4 174
Cr Proceeds from insurance 277 826
The insurance award of R32 000 received by insurance company a deemed
supply under section 8(8)

The award of R32 000 is deemed to be consideration for supply of services

The award of R250 000 relates to the total reinstatement of 'motor car' for which
the input tax deduction was denied and the 'motor car' is damaged beyond
economic repair, therefore not a deemed supply
Time of supply is when the payment is received on 28 July 2023

Dr salaries 77
Cr Output tax 77
The right use of the motor car is a fringe benefit is a deemed suply as per s10(13)
R300000*85% *100/115 *0,3% = R665
R665-R85 = R580
R580 *15/115 =R77

Dr Bank 50 000
Dr loss on sale of the car 70 000
Dr Accumulated depreciation 90 000
Cr Motor car 210 000
Sale of scrap material of the 'motor car'
Non-supply- Input tax was denied on the purchase of the 'motor car' as defined

Dr Insurance premiums 104 348

Dr input VAT =120000*15/115 15 652
Cr Bank 120 000
Short term insurance premiums constitute standard rated supply
available
maximum
Transaction 2 Workings Debit Credit
Dr Bank charges 19 130
Dr Input tax =22000*15/115 2 870
Cr Bank 22 000
Bank charges are standard rated

Dr Bank 345 000

Cr Interest income 345 000
Interest income is exempt

available
maximum

Presentation and layout

Total Overall marks