me o[Oo 7 & SOTSWANA EXAMINATIONS COUNCIL Botswana General Certificate of Secondary Education mae” (SECH ABA — Ansnieraed CENTRE .- CANDIDATE NUMBER NUMBER 2 ACCOUNTING 7 061401 } Paper 4 . - ‘October/November 2014 = @hours +S . Candidates answer on the Question Paper. = No Addtonel Materials ere required. “yd READ THESE INSTRUCTIONS FIRST Write your name, Centre number and candidate number dn ait the work you hand in. Write 1 dark blue or black pen, ‘You may use-2 soft pene for any diagrams or graphs. - Donotuge staples, paper clips, highlighters, glue or correction uid, DO NOTAWRITE IN ANY BARCODES. Answer ail questions, Celoulators may be used. ‘Where layouts are to be compisted, you may not need all the lines for your answer. “The businesses mentioned in the Question Paper are fittious. Alte end of the examination, fasten all your work securely together. ‘The number of marks is given in brackets [atthe end of each question or part question, For Examhiner’s Use 1 2 3 4 5 6 TOTAL This document consists,of 20 printed pages. Tur overEvaniers There are 10 parts to question 1. tse For each of the paris (a) to (] below there are four possible answers Ay B.C and D. er eaet one you consider correct and place atic (v) inte box fe indicate the comeck answer. 4 (a), Thato bought goods fer cash from Richard. How wes this recorded in the books of Thato? | aooount to be debited account to be credited! A L cast purchases | B casti Richard c purchases cash | D Richerd cash (6). Khumo returnedsgoods to Mokone, How will this be recorded in Mokone’s accoun!? ‘A. debit the returns inwards account 7 | B_ debit the returns outwards account © credit the returns inwards account 1D credit the returns outwards decount (@) B. Bino sold goods on credit. Which source dacument was used by B. Bino to record this transaction? A ete oO B debit note i purchases invoice D sales invoice (a) A trader bought goods for P1600. He was allowed # trade discount of 20% and fa cash discount of 3%. How much did he pay? A P1200 P1216 P1280 P1520 B c BD oBEC a4 star ONSa, ete . 3 For . examin w "+ (@) The dlscount columns of a cash book showed th falling tla: to P200 debit P4150 credit ‘Which entry should be mede inthe discount allowed account? A P50 credit B P150 debit © P20 credit D P20 debit (®) Acustome#’s account in 2 supplia’s books shows a debit balancs of P40. What does this mean? ‘A The supplier owes the customer P460, B The customer has paid the supplier P450. G__ The supplier has paid the customer-P460. D. the customer owes P469. cl Pg {g) Kgosi Ltd always uses the straight ine method when depreciating its non-currer assets: - . . ot ‘Which accounting principle is being applied? A. accruals B consistency C historical cost D prudence {h) How are drawings recorded in a statement of financial position? ‘A asan addition to capital Bas an addition fo current labifties © asa deduction from capilal : ea D__2g.a deduction from current fabiltles (i) , Which is a Statutory deduction from a gross pay? Ax income tax B medical aid © trade union subscription D_ pledge to charity epEc at s cs wovONs Frum over4 * Fee (A bbusiness made a loss for the financial year. What effect would this have on the statement of financial position? A decreases capital owned B decreases current fablities LI C increases capital ewployed D increases netassds - CI . [Total: 10] opecane ostaovonts“OO BOTSWANA EXAMINATIONS COUNCIL Botswana General Certificate of Sacnndary Education centre | - CANDIDATE |. > NUMBER . NUMBER ACCOUNTING . os1arot Paper t : October(November 2014 : 2 hours ‘Cendidatés answer on the Quastion Paper. No Additonal Materials ere required, READ THESE INSTRUCTIONS FIRST ‘Write your name, Centre number and ‘candidate number on all the work you hand in ‘Write in dark blue or black pen.” ‘You may use soft penell for any diagrams or graphs. + Donot use staples, paper cli, highlighters, glue or correction ful, bo NOT-WRITE IN ANY BARCODES. : Answer all questions, - Calculators may be used. Where jayouts are to be completed, you may not need all the lines for your ansiver. ‘The businesses mentioned in the Question Paper are fetiious, Al the end of the examination, fasten all your work securely together. ‘The number of marks is given in brackets {]at the end of each question or part question. | For Examiner's Use 1 | 2 3 4 5 6 [TOTAL This document consis's of 20 printed pages. bes zor . {Turn over‘There are 10 parts to question 1. For each of the parts (a) to () below there are four possible anstee A,B, C and D. ceeeae the one you consider correct and place a ik (7) inthe box fo indicate the correct answer. 4 (a) Thato bought goods for cash from Ri ‘of Thato? if account to be debited account to be credited A cash purchases f B ‘cash _._ Richard c purchases cash Db Richard cash (8) -Khume retuned goods to A B c D {e) B. Bino sold goods on credit. Which soures ichard. How wes this recorded in the books debit the retums inwards account debit the retums outwards account credit the retums inwards account credit the returns outwards dccount record this transaction? A B c D (@) A trader bought goods for P1600. He was allowed a trade discount of 20% and credit note debit note purchases involcs sales invoios a cash discount of 5%. How much did he pay? A B c D e@necmte P1200 Pi216 P1260 P1520 cetuoTIONt Mokone. How will this be recorded in Mokone's account? document was used by 8. Bino 10 Ul Ud im Cl LO L]3 (@) The discount colurnns of a cash book showed the following tolals: 200 debit 150 credit ‘Which entry should bs made in the discount allowed account? A P150 credit B P150 debit © 200 credit D P200 debit (f) A customer's account in a supplier's books shows a debit balance of P460, What doss this mean? ~ A The supplier owes the customer P4560. The customer has paid the supplier P460. © The supptier has paid thie customer: P460. D_ The customer owes P480, “(g) Kgosi Ltd always uses the straight line méthod when depreciating its non-current. ” assets: . . Which accounting principfe is being applied? A accruals ‘consistency historical cost prudence von i (h} How are drawings recorded in a statement of financial position? as an addition to capital ‘8s an addition to current iabilties ‘as a deduction from capital 28 a deduction rom current abilities gouD (i) Which is a statutory deduction from a gross pay? A. income tax 8 medical aid © trade union subscription D pledge to charty onEc zm cerapvionets Ul : Bee CI [Turn over4 (i) Abusiness made a loss forthe financial year. What effect would this have on the statement of financial position? A. decreases capital owned B decreases current liabilities © increases capital employed D increases net assets ~ egec 2014 cataowonns [Total: 10] Use2 @ (a) Name two non-current assets. & 1 (b) (i) Bongi, a retailer, has made many mistakes in her classification and treatment of cortain items of either capital expenditure or revenue expenditure. In the table below, place a tick (¥) under the correct column to show whether the item is revenue expenditure or capital expenditure, Tevenus expenditure | capital expenciture 4 | Costof instalation of new machine 2. | Purchases of goods for resale 3 _| Legal costs invoWed in the . purchase of fend and buildings [3] (ii) Complete the table by showing the effect of the errors on asset andl owner's equity in Bongi's statement of financial positon. ‘The first cre has: been completed as an example. . . . error effect on statement of financial position . assets owner's equity | 1 | A cheque, P600, paid for wages | Overstated by PE00 | Oversiated by P00 d .was not recorded ic the books. 2 | Purchase of office fumiture, | . P3000, was recorded into the| purchases account. 3 [P5000 paid for repairs to .| premises was entefed in. the premises account. ‘4 | Bought a vehicle, P100000, with a life span of five years. The whole amount of P100 000 was charged into the current period's i income statement, a [6] {e) Explain the.term goodwill, ti] (d) Explain what is meant by the term ‘debenture’. nl @BEC204 B cewiovonit4. tum over examiners6 Moshe's inventory had a cost price of P720 and @ market value of P880. (0) (@). State the value at which Moshe's inventory would be included in his financial stalements. (fi) State two reasons for your answer in (e} (1) above. (| Alcan Lid provided the following information for the year ended 31 March 2014, Issued Capital» . 200000 6% Preference shares of Pt cach fully paid 300000 Ordinary shares of P1 each, fully paid General reserves P60000 Loan Capital” 6% 800 Debentures at P100 each Caloulate the shareholders’ funds. Show your workings. t epec wis oataotscanies Examines7 . Fer ever > (g) Explain two differences between merchandising business and a service busness, Te Merchandising business "Service business ~ 4) [Totals 22] BEC 206 g oeraouomts [Tum over8 3 The folowing account sppesred in the ledger of Ben Teo. Dr 2014 Apr 1 Balance bid 250 2014 21 Sales May 1 Balancebld 316 0. Kesekile accour int cr __ 2014 P April 10 Bank 245 40 Discount 25 Retums 7 30 Balancecid 316 588 (2) Explain each entry in theabove account. - ‘State where the double entry for each transaction would have been made. “The first one has been completed as an example. Aprild Balanos bid Fit 2014. Double entry: Credit side of O. Kesekie’s account on 34 March 2014 April 10 Bank April 10 Discount Explanation DLA. A.CASIA.£ fume a Double entry. Deku en nec 2014 10m Nepal’ 204, petaiovOMrd Explanation: This is the smouit of money. 0. ‘Keselile owed Ben Tefo atthe start of ApriFor lexomtners April 21 Sates Explanation. whoy Pe Double entry... Ou al Ine “BOIL. April 25 Returns: = Explanaton..2: a earned. oe Jatt | Tem ab Ee Sthre OF May Qo14, {¢) State four reasons why Ben Tefo prepares manufacturing account. {d} Explain the term indirect cost, with an example. 4 a eBECz04 is cota vonts Trurn over40 Ben Tefo's fnancial year ends on 31 December. He provided the following information for the year ended 31 December 2014. inventory at 1 January 2014: Raw materials ‘Work in progress Finished goods Inventory et 31 December 2014: Ray materiats Work in progress Finished goods ‘Owing at 4 January 2014 in respect of: Raw materials purchased Direct wages Overhead charges. Owing at 31 Dedember 2014 in respect of: Raw materials purchased Direct wages. Overhead charges Paid to raw material suppliers during the year Direct wages paid during the year Overhead charges paid during the year ‘Number of goods produced during the year Pe 14250 3375 49800 13.500 5625 15300 10250 2.250 2500 15750 4500 * 1800 112600 87750 11700 45.900 units (e) Prepare Ben Tefo manufacturing account for the year ended 31 December 2014. opeczo4 ostaio1cine [Examiners UseBEC 014 " Ben Tefo Manufacturing Account for the year ended 31 December 2014 optarottonate ++ [9] [Totat: 25} [Turn over12 Fon lexerniners 4. Joe Botho, a sole trader, divides His ledger into three sections ~ general ledger, use purchases ledger and sales ledger. {@) (i) State two advantages to Joe Botho of dividing the lodge into three sections. (i) Name two accounts which would appear in the general ledger. ‘Joe Botho prepares conirol accounts for his trade payables and trade receivables at the end of each month. . . He provided the following information: 2014 P May “1 Trade receivables tedger control account 9176 debit. ‘Trade payables ledger control account “== 8.880 credit ‘Trade payables ledger control account ‘0 debit* * 2014 May 31. Totals for the month P Purchases journal 30965 ‘Sales journal . 40310 Purchases setums journal 625 Sales returns journal 510 Cheques received from trade receivables 40585 Cheques paid to trade payables 29800 rade receivables’ cheques dishonoured 250 515 390 Bad debts writien off 120 eBEcans Osr4101ONNE3 .*(b} Prepare Joe Botho's trade payables control account and trade recievables control ‘account fer the month of May 2044. Bring down the balances on 1 June 2014. Joe Botho: Trede payables control account 1 : Yoste P eae 2014 cs 14OtrONIt [Turn over14 {c}. Stats two reasons why itis possible to have a debit balance brought down on & trade payables control account. (a) Explain one way which Joe Botho might use fo reduce the isk of bad debts. Sous 7 Joe Botho's financial year ends on 30 Apfil, He receives a fixed monthly commission from Jane Kabelo. On 30 April 2014, Joe Botho provided the following information. “2014 . : P May 1 Jane Kabelo owed one month’s commission 600 July 4 Jane Kabelo paid comission for 15 months (0 80 June 2014 9000 (e) Prepare the commission receivable account in Joe Botho's ledger for the year ended 30 April 2014. Commission receivable account Total: 24] Bec 24 osteo5. ‘eo 15 : . ‘On 1 April 2014 Moyo, a farmer, bought ploughing equipment for 40000. The equipment is expected to be used for 5 years with an estimated scrap value of P80. No depreciation is charged in the year of disposal. {a} State two reasons why Moyo charges depreciation on his non-current assets. {c} Caloutate the depteciation.charged in Moyo's income stalement for each of the two years ended 31 March 2013 end 204. Show your workings. (i) Year ended 31 March 2013 © (il) Year ended 34 March 2014 ever ats a sorwevone [Turn over16 (¢) (i) Complete the folowing extract from Moyo’s statement of financial position at 31 March 2014, Moyo Extract from Statement of Financial Position at 31 March 2014 Non-CurentAssets Cost Depreciation to date Net book value P P P AL2228. ieee Equipment (li) 1 February 2014, Moyo sold the existing equipment for P2000 cash. Prepare the disposal of equipment account in Moyo's Ledger. Moyo Disposal of equipment 15) OBE 204 ceanONs4 7 _ + (@} Moyo has been experiencing shortage of working capital. Suggest twa ways Moyo could use to increase his working capital, 4 (I) State one limitation of each of the following principles. Money measurement eReC2n4 agtecsronts [Tum over18 6 Francistown Sports Club was formed on 1 July 2013. The treasurer of the club provided the following receipts ard payments account for the year ended 30 June 2014. Francistown Sports Club Recelpts and Payments Account Receipts P Payments : P 2014 2014 June 30. Scbserptions 6800 | June 30 General expense 1430 Sele of tickets for open day 3250 Insurance 670 Loan from a member 1000 Purchase of equipment 3600 Expenses of open day 1950 Rent of premises 2442 balance old 958 11050 771050 2014 July 1 Balanee bid 958 ‘Additional information 4 At30 dune 2014 ‘Subscriptions:due from members amounted to P200 Rent due amounted to P20 2. The equipment was purchased on 1 April 2014. Depreciation isto be cherged at the rate of 10% per annum from the date of purchase, using the reducing balance method. : BEC 204 vatanvonuidE2yULsuuues BOTSWANA EXAMINATIONS COUNCIL Botswana General Cerificate of Secondary Education CANDIDATE NAME CENTRE + CANDIDATE: | | NUMBER NUMBER | ACCOUNTING 0614/01 Paper 1 OctoberNovember 2015 2hours: = 5 5 Candlidetes enswer on the Question Paper. No Additiorial Materials are required, READ THESE INSTRUCTIONS FIRST Wille your name, Centré number and candidate number on all the work you hand in. ‘Wits in dark blue or black pen, You may use a soft pencil for any diagrams or graphs. Do not use staples, paper clips, highlighters, glue or corréction fluid. DO NOT WRITE IN ANY BARCODES. . Answer all questions. | Calculators may be used. ‘Where layouts are to be completed, you may not need all the lines for your answer. ‘The businesses mentioned in the Question Paper are fictitious. Al the end of the examinetion, fasten all your work securely together, ‘The number of marks is given in brackets [] atthe end of each question or part question. For Examiner's Use elalale| ra)» TOTAL eECZS This document consists o! 19 printed pages and 4 blank page. [Tum overExeminer's Use ‘There are 10 parts to question 4 For each of the parts (a) to () below there are four possible answers A, 8, G and D. Choose the one you consider correct and place a tick (“) in the box to indicate the correct arswer. 1 A sole trader pays private expenses from the business bank account and records them as drawings. (a) Whict accounting principle is he applying? accrual gping conéern A ” B_ business éntity c D. prudence (b) Whatis the dduble entry for goods withdrawn by the ownér for personal use? acocuntto ba debited | -_accourit to be credited A drawings inventory O B drawings purchases bee c inventory ‘ rawings Cl D purchases . drawings {c}_ Which source document is used for preparing a sates journal? credit note debit note. : LI invoice vo @ > receipt @ REC 2015 natin3 examiner's {d) A business buys a machhe for P25 000. it will be used for 5 yaars and the estimated -| Yee te) a residual value is P6250. What is the arinual depreciation charge, using the straight line method? P3750 P5000 P6250 oo w > P41 250 A business provided the following information for the year ended 31 July 2015. Cost of sales Opening inventory... Purchases. Retums outwards Pp -60 000 What was the closing inventory? ‘SBEC 2015 Sg credited to the income statement debited to the income statement opto 16000 68.000 2000 added to trade receivables in the statement of financial position deducted from trade receivables in the statement of financial position Zz [4 (urn over4 (9} Botho cams P10 000 per month. She pays income tax of P1500, medical aid > 1000, funeral scheme PS0Q, pension fund P250. How much did she pay on voluntary deductions? A B c D P1750 P3250, P6750 P8250 (h) What would be included in the income and expenditure account of a club? oo w > legacy from a member loan from the bank sale of old equipment at book value subscriptions received from members ()) Which subsidiary book is used fo record bad dabt written off? * A B c D cash book general journal purchases journal seles journal {i) What does the quick ratio measure? A B c BEC 2S capital structure affciency liquidity proftabitty oetamrionyis moo pogo [Fotal: 10} e Fee2 BEC 2018 5 {a) (State how inventory should be valued. Wen (il) State two reasons why it may be necassary to revalue inventory before two businesses amalgamate. ‘nue .Mary..be ook 2akerd.. toa fn Paenaged.. {b) Complete the following table. [ [ “Transaction | aoc be “moet | ()) | Bought motor vehicle by cheque |Motor Vena, Bank _| {i) | Recsivedrentincash (su Reng ecenel | (il) | Loan received from the bank Bank Bante ivan : - 6 (ce) Name the pccourteg principle which states that profit should not be overstated. a i (d) State the meaning of a contra entry in a cash book. . . where. davbl fey for. Casha..and...bane IS. completed igo. (2) Name the section of a farmers statement of financial position where chicken layers would be shown. OV. CURR... ABS EAS, # calamtONNS: {Tum over6 . a Sraminers {f) State three reasons why a business may use the reducing balance method to depreciate its fleet of motor vans. (g} State the meaning of the following terms. (i) Authorised share capital @BECIIS osr40 ONS7 B Shorobe is a trader. She buys and sells goods on credit. She keeps a full set of accounting -| records. {a) State two benefits te B Shorobe of using subsidieny books. ren, nant, site, Several Pe Saves. fh eet e.number, of eanSethous can SAEs ve A ed Tuacton ACE REPO 4& owes hatey Cell he een i a During the month of July 2016 the following transactions took place. 2018 : July 1 Bought goods on credit from Bahumi Traders, P4560, less'20% trade discount 9 Purchased goods on credit from Sekgwama Ltd, P2800, less 25% tfade discount 13. Received a credit note, 180, ftom Bahumt Traders . 28 Goods, P3100, wore purchased from Ngaka Stores,'on credit . + 31. Returned goods, P80, to Ngaka Stores ° (b) Record the above transactions in the following subsidiary books. "() Purchases journal . i B'Shorobe . - Purchases joumal 4 Gi) Returns outwards joumat B Shorobe Retums outwards journal (3) bbe cline hsp For Examiner's Use be sneice & cst40vonns [Turn over8 {c) State two reasons for checking the purchases invoice against the purchase order, 1y\m..coraGiren. if. Mae coneck. grave. is..quaked | wr0lcg, (e) On 4 April 2015, C Tebogo bought goods on credit ffom B .Shorobe, list price P8600. B Shorobe allows 20% trade discouint and 3% cash discount for payment within 30 days. C Tebogo paid B Shorobe on 25 April 2015. (i) Calculate the amount paid by C Tebogo. Show your workings. leserade chscant ?...20 REC 208 osteotionts For Examiners Use9 (ii), Prepare the acoount of C Tebogo in B Shorobe's sales ledger. Dr . © Tebpgo account (8) C-Tebogo returned goods to B Shorobe, Name the subsidiary book where B Shorobe will record this transact (a) State the business entity principle. Tus. principle, states. Haak. +x War dausriness. must oe, Separately. iecede, fora... Khese B ts Dtoner: eBECzIS g 06140 TTON onsecties, sxelated ke 0 [Total: 22] [Turn over40 {c} State the meaning of the term direct expenses. Give one example of a direct expense. reo gz B Oteng, a fyanufacturer, provided the following information. 4 October 2014 30 September 2015 Pp P Inventory: - Raw materials 8000 : 7000 Finished goods, 14000 13.000 For the year ended 30 September 2015” - P Purchases of raw materials 120000 Factory direct wages 25 000 Factory indirect wages 413.000 Factory power ight and heat 2.000 Depreciation of plant and machinery 4000 Factory rates 4700 ‘The following additional information was available at 30 September 2015. P Factory power owing . 250 Factory rates prepaid 150 seven oetgouomnsa“ " (@) Prepare B Oleng’s manufactuing account showing clearly cost of raw materials used, prime cost and cost of production for the year ended 30 September 2015. Manufacturing Account for they you! ended 30 September 2015 esecans ce1govoms [Turn over42 B'Oteng maintains a provision for doubtful debts at 3% of her trade receivables. On 1 October 2014 her provision for doubtful debts was P1350. On 30 September 2015 8 Oteng’s trade receivables amounted to P48 000. (e} (i) State the meaning of the term bad debt. Mk. oleed. customers... ucts is : lex sucecowerdle.| Lolicks tise customer s...uteble. FP i) prfpsred Oteng’s provision for doubtful debts account for the year ended 30 September 2015. Balance the account and bring down the balance on 1 October 2015. B Oteng Provision for Doubtful Debts account RECS 2 os tapricmuts [otal 17] For Examinerstee 8 For : Examiner's 5 (a) Explain whatis meant by an accrued expense. vse 99). E2. BME... phy. ATC npesd.ckchae..20A.cf. bao Yew On 4 January 2014 Maziya Ltd had the following balances a oe . Pp we Rent receivable owing 2000 . Inventory of stationery - 500 ac Rates prepaid 2200 geih ‘The following transactions took place during the year ended 31 December 2014, . 2 Pp J, gjeRent reesived by cheqtle 26 000 < Stationery paid by cheque += 3.800 Rates pald by cheque 5 640 "On 31 December 2014 Pp fe Rent receivable owing ~~ 4000 Vee - “. thventory dfstaionery + 450 , Rates pregiad - 3000 awed (b) Prepare the following ledger accounts for the year ended 31 December 2014. Bring down the balances on 1 January 2048. . a . Rent received account bhAbbes Pipe | oe Baal T t Be ‘ | Fa lorwing Wd Zeca! best] Bonk __| 4) desl Pac BHD dey | erown.eld | You . 5 Zou - raOTS | — __ {eos Oe - Jeu [Oto Wd [Ace | | Sy 5 a {av Wenwede Pay on dchipad “Capoose. u to Crolat sede. BES 2015 DeLAIOONMS [Turn over14 Shey vt 2 Se Stationery account For lExemmers Use teased een - Bonn: 3 ‘ingle. | Deeds | P| Pd] Detas P| fc Fis 9 Se] Iwertgy tA leno Pal. _|sysp . ag my 4] eldqsor j— a —— ee mifeeace, | _[nverta He |aso Spseow Dy sort . eo Side iS . ® 5 - Y “ zastdoveneo wt Case) or tne OF Soe Pie a - [ * | ; “Powe — |sego. [owing dol gasd econ a | : [Pate | gue | + sterlea : Reaol etd |eooe| — aakeat : Shep) “260 pepayne Precal_ic)| 260 Bois 7 eer Cees (41 (0) State the effect on the statement of financial position on 31 December 2014 if no adjustment was made for the rates prepaid af the end of the year. (4) Explain why it is important for Maziya Ltd to observe the accrual principle when preparing the income statement for the year. POSER. OBEC ZS detovoNnsel 15 ___ Maziya Ltd provided the following ist of assets. | Accrued revenue Cash at bank Cash in hand lventory Other receivables Trade receivables {e) Complete the table below by arranging the assets above in order of liquidity {most liquid asset firs). Order of liquidity Ben On hard 2 sia ab bank 8 BAKA WES 4 Agno revenue (5 Yea ke 12. rece ehies 5 YY 23EC 2015 e veransoneis {Tum over6 Mercy and Perey are in partnership. They do not have a partnership agreement. They decided fo maintain a capital and a current account for each partner. (a) Dafine a partnership. A. Sousmess...i {b) State the meaning of each ofthe fol (Fixed capital account (fi) Flyctuating capital account f..obuck..oclucles, .allecahon. oP. watered con. dramas. gine Ut books of Mercy and Percy after the preparation - > @ yes ens Se The following balances remained on the 16 lowing terms. of the Income statement for the year ended 31 December 2014, Equipment at cost Provision for depreciation of equipm Trade receivables Trade payables * Motor vehicles at cost Provision for depreciation of motor v Cepital ~ Mercy Percy Inventory Fixtures and fittings at cost Other payables Bank Drawings - Mercy Percy Profit for the year rent fehicles |REC IMS, OB T4LORINIS pé 20 000 + 2.000 6.000 5.000 60.000 42.000 45 000 35 000 5.000 5500 200 3400 Dr 2500 4300 7000. 7 | __ For On 31 December 2014, if was found that the following errors had been made. | 1 Inventory on 31 December 2044 had been overvalued by P500. 2 Depreciation on fixtures and fitings, P800,was not recorded, 3. Discount received, P300, had been omitted from the Income statement, 4 Noentry had been made in the books for bank charges, P100. 5 Rent paid by cheque, P400, was recorced inthe income statement as P6CO. {c) Prepare @ statement to show the effect of correcting each of the errors 1-5 on Mercy and Percy's originat profit for the year. Calculate the corrected profit for the year. . The first one has been completed as an example, Morey and Percy . Statement of Corrected Profit for the year ended 81 December 2014, Profit for the year before corrections | - Effect on profit for the year | “Tnsrease # | Profit for the year after corrections 609d (1 execs | sptancnus [Turn over18 (d) Prepare the statement of financial position of Mercy and Percy as at 31 December 2014 after al errors have been corrected. Mercy and Per ‘Statement of Financial Position as at 31 December 2014 fon (ueuk. Assets . Equipmenk..... Motor Vehicles | Depry wev(Pi (SRE... © BEC 2015 For Biominor’s Use(@) State thrae advantages to Mercy and Percy of maintaining a current account for each parinet. ONABUS (f)- State one reason why Mercy and Percy should have drawn up a partnership'agreement. Xe USM dersbearcchuge, “agree 19 . Nee ‘ calealoda oP Cumerrk aterord =—~" belonte for qveshun A (pane 0 fFotal:2a] For Beene: Use Garren sen ode] 7 PER] Bebb Mares | Perey Pane a Woo , (S000 | 6300 Bat bid fo] ig6cl © Perey, has Sverdiguon Werte ‘—Piz0d SEC 2018 C6 1aOTKONAS:BOTSWANA EXAMINATIONS COUNCIL Botswana General Certificate of Secondary Education . CANDIDATE NAME, LL + CENTRE | TT) Td NUMBER | = 3B accounting 0614/01 > ‘Papert tos October/November 2016 & 2 hours EZ Candidetes answer on the Question Peper. SP) No Additonal Materials ere required. 2 EBB READ THESE INSTRUCTIONS FIRST . Write your name, Cenire number and candidate number on all the work you hand In. ‘Write in dark blue or black pen. ‘You may use a soft pencil for any diagrams or graphs. Do not use staples, paver clips, highlighters, glue or correction fluid DO NOT WRITE IN ANY BARCODES. Answer all questions, Caloulators may be used. ‘Where layouts are to be completed, you may not neéd all the lines for your answer: ‘The businesses mentioned in.the Question Paper are fictitious. ‘At the end of the examination, fasten all your work securely together. . “The number of marks is given in Brackets [] ai the end of each question or part question, : For Examiner's Use , : . 200. - f ; : 4 | 4 6 or , jor | This document consists of 18 printed pages and 2 blank pages. : [Tum over @BEC 2016‘There are 10 parts to question 1. For each of the parts (a) to (j) below there are four possible answers A, B, G and D. Choose the ‘one you consider correct and place a tick (~) in the box to indicate the correct answer. 4. (a) Which is a current liability? A cash in hand B_ interest owing prepaid rent D trade receivable - . (b) A cheque paid to’ Bani by Masego was returned unpaid by the bank. How was this recorded in the books of Bani? [ | account to be debited account to be credited al: bad debts | Masego B bank Masego c Masego - chad debts 7 D Mesego bane [EF (c) When may a business issue @ debit note? A when goods have beer received from a supplier B when goods have been retumed by a customer when goods have been returned to a supplier D__ when goods have been sent to a customer (a) Which item may eppear in the debit column of a bank statement? A. bank cherges B dividend received © uncredited cheques D unpresented cheques S8EC m6 ost4/or/CNs MO g ge” There are 10 parts to question 1. For each of the parts (a) to () below there are four possible answers A, B, C and D. Choosé thé ‘ane you consider correct end place a tick (v) in the box to indicate the correct answer. 4 (a) Which is a current tabitity? A cosh inh Ce - B interest owing © prepaid rent DB trade receivable oo {b) A cheque paid to Bani by Masego was returned unpaid by the bank. How was this recorded in the books of Bani? C | account to be debited - accountio be-cedited | | ja] ‘bed debts | Masego | B benk Masege / ce Masego : bad debis DB Massgo : bank (c) When may a business issue a debit note? A when goods have been received from a supplier when goods have been retumed by a customer ogo when goods have been returned to a supplier 1D when goods have been sent to a customer [ (a) Which item may appear in the debit column of a bank statement? A. bank charges B dividend received uncredited cheques D unpresentod chequce O @8E0 2018 on raoro Ree3 (@) Bank charges have been debited to the business rates account, Which type of error was made? A “B c D commission omission original entry principle (f) A traders trial balance showed a shortage oh the debit side of P340. A B c D cash book control account suspense account the joumel ~” Which will be used to record the difference? (g) Where does the total of discount allowed appear in a control accounts? A. credit of the creditors contro! account B credit-of the debtors control account C debit of the creditors cofitfol account D debit of the Gebtors contro! account (h) Boteti Traders provided the following information. Non-current assets: Trade receivables ‘Trade payables Inventory Bank overdraft Cash P 56 000 18500 13 250 45 150 8100 250 What was the total of the assets? A B c D SEE ANE Ped 660 Pag goo PS2750 P98 000 osraavonuTs Oso C] is Of [Turn over]4 {i)_ Which item is dobited to a partner's current account? A ‘interest on capital B interest on drawings 4 partner's salary D_ profit share J) Which document does an employee use to record his hours when he is working away from the company premises? A clock card B ~paysslip © poyrolt register D_ time sheet Ki [Total: 10} @8EC 2016 os1aorone5 ~ 2° (a) State ene cost that may increase a'trader’s cost of purchases. Imemt..duh esa... (b) Explain what is meant by direct debit. laiola..p.mypn2nks..ole al (c) () State whet is meant by financial accounting. AVS. nding... .p.¥epacaht (i) State what is meant by management accounting. 2 Towalyes. using... Satuie... (©) Explain why capital is regarded as a liability to a business. TEP Ieserats, aare,.200%h, dunds... Ck. aPEEN. Paying re Gectilers eg) ~ etecane cereovonuie [Turn over}6 (8) State two reasons why customers may retum goods to a supplier. ree: anubney Weve Kabone Traders maintains a rovision for doubtful debis at 3% of the trade receivables, On 1 May 2015 the Provision for doubiful debts account was P1260, On 30 April 2016 Kabone’s trade receivables amounted to P50 000. (8) (I) Calculate the amount to be charged as the provision for doubtful debts in the income ‘statemont for Kabone Traders for the year ended 30 April 2016. (ii) Prepare an extract from the statement of financial position of Kabcne Traders 2s at 30 April 2016 to show the trade receivables. Kabone Traders Stetement of Financial Position (extract) as at'30 April 2016 Total: 21] eBECz016 os 14/01/NNI lex,7 3° (@) State what is meant by cash receipt journal. Man gaj-jpoxnal. thé,.cash...! wk. dhe..bRemess....is...hecarded Kitso is a trader. He buys and sells goods on credit. On 1 September 2016, he paid a credit supplier Julia Moeng, P3200, by cheque less adm cash discount. (b) Complete the following cheque by inserting thé missing Words and figures In the spaces avis (i) to (iv, Bano XYZ | Pay(iy “dua Moens, The sum of (iy Three, Hhoesond one hunched auol “boenkay pile only ow [Pian Keto | Francistown Branch - Date (i) [1 Seplenibay 2h 7 ; Signatare | 0044 100504 10345674. AIG 10345674 | . (41 Shote regsons why a chee Mou be elishonoored, 4 iP the amioont in words APRs Rom amoont ws “Rgures : 2. sent onde cheque diflen fron specime) a» Cree « Sole: » @8EC2018 seraouONIS {Turn over}8 Kitso’s transactions in September 2018 included the following. September 1 Cheque, P3200, was paid fo Moeng less 2.5% cash discount © Purchased equipment, P20 400, on credit frétn Magalies Stores 9 Paid rent, P13 000, by cheque, . 12 Took cash, P2000, for own use. 17 Bought stationery, P120, by cash 21 Paid Kgope’s P1100 by cheque after deducting 5% cash discount. 26 Paid wages, P9800, in cash 30 Took, P4509, from the business bank account and paid the school fees for his child, (©) Enter the above transactions in Kitso's cash payment journal for the month of September 2016, Use analysis columns for expenses, trade payables (creditors) and ‘drawings. Total the expenses, and the analysis columns. The cash payment journal is on the opposite page. REC 2018 os tarotromuaspeg, d - yseo, dl d d d enone sojgeced 5 wWnoosig sHuyneig | oper, | sesuadks| | - syeiog “eed Jewnop uawARg YseQ Ost [Torn over] oetaovtonie + @BECINe10 Duting the first week of October 2016 transactions took place in Kitso's business. {d) Complete the following table to name the subsidiary book and the source document for each of Kitso’s transactions that toak place in October 2016, : —— Transaction | Subsidiary book | Source document | | Purchased goods on credit from Webo . ~ | wholesales _ _Barclanges Parcieses Wie) ‘Sold goods on credit to B Sefho (Seles Soarred Seles wnvowe : , ehorns mars (Geat pole ‘Sefho returned goods - eas re | Retumed goods to Wabo Fou ped) cata [8] {e) State two advantages of each of the following bank accounts. () Current account eRED Ire OB tAIOHIONITE“ 4 The following account appeared in Malebo Ltd’s ledger. Insurance account 2015 P [206 | Pp dune 4 Balance bid 500 | May 3¢ Income Statement 3500 August. 1 Cash 3600 —_ 3t Balance c/d _600 4100 4100 2015 . . Jung 1 Balance bid 600 (2) (0) Explain the following entries in the insurance account. eBecane dure 1 Balance bid P500 May 31 incomé statement P3500 coerce. fer. Tnserance, _ Ene, meme _steeme May 31 Belance cfd P600 ~ Arazonk oP (li) ‘Sate the section of the staternent of financial position on 31 May 2016 in which. .the balance of the insurance account would appear. _Garicent.. ostworronis ak. ysvionce, prepa Pr the yor [Tim over]12 (b} Name and explain one accounting concept that Malebo Ltd applied in the preparation of the insurance aecount. Matebo Lid applies various policies, Matching | ecemal. concep (€) Complete the following table to name and expiain each accounting concept Malebo is applying. Policy Accounting concept Explanation Recording non-current assets at book value father than market value | Gowney Cone The cones assumes khab the beings Goll combree bo 6: ndefinabel ne One ee Oe Sous ak brok value. | Material JP the cos P tecoseling Writing off non-current assets valo: - costing ess than P100 in the assets oF & fon meter year of purchase t ot sing Pret 41,204 abe, E as an PEOSE, HS Revenve s only Not recording orde ‘ved 5 Metrnrcrg cnerseceves | Realuscti0r a5 being warned Boe, are issued lejal tHe @ 1D tne. goods passes bp Lhe! — yer ~ J (8) eeec 2016 cetansonvse» (@) Explain how each of the following may be "spared 2s a limitation of financial statements, 1 Non-financial aspects Exact, Use * omeané cevsowoNne [ur over}14 Mogoditshane Tennis Club was formed some years ego. In addition to providing tennis courts and coaching, the club also runs a snack bar. On 1 April 2076, the balance in the club's bank account was P2680 and the snack bar inventory was P50. The following information was also provided. : Pp Sales of refreshments 2100 Purchases of tennis equipment 5600 Tennis coach salary 3200 ‘Wages of snack bar assistant 800 ~ ‘Snack bar purchases : 700 Rent and rates 2450 Oiher operating expenses 1200 Snack bar inventory 31 March 2016 65 ‘The club has 60 members and each member pays an annual-subscription fee of P30. On 31 March 2016, 5 members’ subscriptions were accrued. (a) Calculate the total subscriptions recelved by the club during the year ended 31 March 2016. Show your workings. {b) Prepare the receipt and payments account of Mogoditshane Tennis Club for the year ended 31 March 2016. Mogoditshane Tennis Club Receipts and Payments Account for the year ended 31 March 2016 6 14/0101N18 Fe Bart5 (6) Prepare the snack bar income statement of Mogadishene Tennis club for the year se ended 31 March 2016, Mogeditshane Tennis Club Snack Bar Income Staternént for the year ended 31 March 2016 OEEC 206 6140106 ” [Turn over]16 fe {a} Suggest three sources of income, apart from subscriptions, for non-profit making Use organizations, When preparing an income end expenditure account of club, itis necessary to distinguish between capital expenditure and revenue expenditure. (©) (Explain the meaning of the term capital expenditure. Give ene example of capital expenditure of a club. Explanation... Money. wo assek..ck. Cartel tem. Sram LarclaGe 1G... MAC INE Ay. (il) Explain the meaning of the term revenue expenditure. Give one example of revenue expenditure of a club. Explanation ..f 0, Example. L2GQRS. 2 & JOS ;.nf ackushes j EXPENSES OF Treckinoy coh 2 otal eeeC 2016 os s irade receivables, unpaid wages, inventory | (b) Kgosi had the following assets and liabilities on 30 September 2017 7 ese. | Office equipment 40.000 Inventory 426 000 Trade receivables 32.000 Bank 8 000(cr) Trade payables 88.000 ‘What was Kgosi’s capital? A P61 000 a B P77 000 c P101 000 wa D P117000 Oo (c) Moupo Enterprises received a cheque from 2 credit customer and paid it into the business bank account. How did this affect Moupo’s current assets? Cash at bank Trade receivables A decrease decrease oO B “decrease increase c increase decrease i] D increase increase | @pec 27 ostaiotonei7Tete 3 ex gee ;'." {d) Which document does a business issue to reduce the amount owed by a credit customer? A. credit note B debit note sales invoice OO D statement of account - (@) Atrader’s cash book showed a balance at bank of P1700. On the same date, the bank statement showed a credit balance of P1800. What caused this difference? A _ bank charges paid B dishonoured cheque standing order paid D__unpresented cheque i] () For which non-current asset is the revaluation method of depreciation most appropriate? ‘A fixtures and fittings oO B loose tools 4 © machinery O D_ office equipment Oo {g) A draft income statement showed a profit of P10 500 for the year ended 31 March 2017. It was then found that no adjustment had been made for the following Items. Pp ‘goods taken for own use during the year 600 rent receivable accrued at 31 March 2017 250 insurance paid in advance at 31 March 2017 300 ‘What was the correct profit for the year? A P9360 1 B P9850 c P11050 D P11 650 Bec 2017 ostwovonui7 [Turn over{h) Which entry is made to record profit on disposal of non-current asset? 4 ‘account to be debited accountto be credited ir asset account income statement [3 income statement assel account Tc | asset disposal account income statement ‘D income statement asset disposal account (i) Where does returns inwards appear in the control accounts? A. credit of trade payables control account B credit of trade receivables control account © debit of trade payables control account D debit of trade receivables control account ) A trader provided the following information Cost of sales Gross profit for the year Profit for the year P 60 000 19.500 12.000 What is the percentage of profit for the year to revenue? A 15.1% B 20.0% © 25.0% D 32.5% eREC 2017 ostgo1OnNtT OM [Total 10) » | Bxaminor’ UseBRC 2017 7 {li) Calculate the company’s profit for the year ended 30 June 2017 before debenture Interest. 2] 081401707 [Turn over8 Thato Mawaba, a trader, sells parts for cars. Her financial year ends on 30 September. On 1 October 2017, she had the following transactions. 4 Bought parts for cars, P25 500, by cheque 2 Sold goods, which had cost P4600, on credit to Nthabiseng for P5200 3 Returned car parts, invoice price P1800 less 20% trade discount, to Kingdom Stores 4 Received a cheque, P2850, from. after deducting 5% cash discount! usg, a credit customer, in full settlement of a debt {a) Complete the following table, stating the double entry needed to record each transaction. The first one has boon completed as an example. Transaction Account to be debited Account ta be credited ) Pp Pp 1 Bank 25 500 Purchases 25 500, ° 7 “| Se Sales suse | 3 ? ~ chy . juue 4 Bouk 4 L il BEC2017 osteovOMNI78 ‘The following account appeared in Thato Mawaba’s sales ledger. Senzo Boatie account ge? 2016 2016 [ Pp oe Oct 1 Balance bid 400 | Nov 30 Bank 475 Nov 3 Sales 250 Discount 25 Dec 21 Bank (dishonoured cheque) 150 | Deo 12 Bank 150 2017 Sept30 Baddebts 150 800 00 (b} Exptain the following entries in the sccount of Senzo Boatle. The first one has been completed as an example. 2017 Oct1 Balance P400 Explanation Nov 30 Discount P25 Explanation Dec12 Bank P150 Explanation eaecan7 S814 ONT i) [Turn over10 Thato Mawaba's rate of inventory turnover was as follows, for the year ended 30 September 2016 10 times for the year ended 30 September 2017 Stimes {c) Suggest two reasons for the fall in the rate of inventory turnover. (2) ‘Thato Mawaba dacided to merge his business with Kagiso, another trader. Before merging, they decicled to revalue their non-current assets and inventory. (d) (i) State the basis of inventory valuation. l .. (li) Suggest two reasons why Thato Mewaba and Kagiso decided to re-valie their inventory before they merged - 2 [Total 16] eBE 2017 8140/0017 Examiner Use"|" 4. P. Kesago is a sole trader who maintains a full set of accounting records. He divides his "1 QR $28 ledger into three sections: nominal ledger, sales ledger and purchases ledger. He prepares control accounts for his purchases and sales ledgers at the end of each month. (a) State the purpose of a ledger account. 1 (b) State three reasons why P. Kesego prepares contro! accounts. 13] {e) State where P. Kesege will obtain the relevant figure for each of the following items. ‘which appear in his trade payables control account. tiem ‘Source of Information Balance in trade payables ledger offset | General Jounal against balance in trade receivables ledger [pecountrosoved | Ca hale % Credit purchases QR nvdnas chuwenad Goods returned to suppliers Partrenses heisen Janne 4] epEC 207 stanton [Tum over42 Fe, lExémincr ‘The total of the balances in P. Kesego’s trade payables ledger on 30 September 2017 heed amounted to P101 480. The credit balance on the trade payables ledger control account on the same date amounted to P108 405. Investigations revealed the following errors. 1 The total of discount received column in the cash book had been overstated by P1500. 2 Appurchase invoice for P3060 had been completely omitted from the books. 3 A credit batance in the purchases ledger had been understated by P160. 4 Acredit balance of P1275 in the purchases ledger had been set off against a balance in the sales ledger, but no entry had been made in either control account, 5 Apayment of P2175 debited to a credit supplier had been omitted from the cash book. 6 Acredit balance of P4815 had been omitted from the list of trade payabies. (d)_ Draw up an amended trade payables ledger control account for P. Kesego for the month ended 30 September 2017. Balance the account and bring down the balance on 1 October 2017. P. Kesego ‘Amended trade payables ledger control account 17) sec 2017 ostaowonui7of 13 lecemins Use {e) Prepare a statement reconciling the total of the trade payables ledger control balances . with the amended trade payables ledger control account balance. ‘Statement of reconciliation of total trade payables ledger balances with the amended trade payables ledger control account balance ~ (5) P. Kesego Is concerned that some of his customers to whom he has sold on credit may not be able to pay. (f) State four ways in which P. Kesego might be able to encourage his credit customers to pay for their invoices. pec 2017 ostaovan7 [Turn over44 For lexaminer: During the year ended 30 September 2017, P. Kesego took goods for his own use. a (g) Complete the table by placing a tick (/) to indicate the effect of goods taken for own use on purchases and capital. Increase Decrease No effect Purchases Capital 2) [Total 26] + @aEC 2017 oo 1ouOnNtTwet For 6 examine: ~ ,* 8S. Moape started a laundry business on 1 October 2018. On that date, he purchased . allaundry machine on credit from Khumo Engineering for P20 000. On 1 April 2016, he purchased another laundry machine for P25 009, paying by cheque. S. Moape depreciates the laundry machines at 30% per annum on cost and fromthe date of purchase. No depreciation is to be provided in the year of disposal. On 31 March 2017, 8. Moape sold the machine he bought on 1 October 2015, receiving a cheque for P13 500. (a) State three reasons why S. Moape’s non-current assets depreciate. (b) Prepare the ledger accounts for each of the years ended 30 September 2016 and 30 September 2017. Balance the accounts at the end of each year and bring down the balances. Laundry machinery account eeecoor oetaoonn7 [Turn over(c) 8. Moape depreciates his equipments using the reducing balance method but @8e0 2017 16 Provision for depreciation of laundry machinery account depreciates his buildings/machinery using the straight line method. a 12) {) State when it is appropriate to use the straight line method of depreciation and the reducing balance method of depreciation. 1 Staright light method of depreciation 2 Reducing balance method of depreciation ostamronwi7 (2)‘ WT Loe (li) Explain why S, Moape uses reducing balance method of depreciation for equipment - and straight line method for machinery. 4 Equipment 2 Machine (2 {d) Complete tho extract bolow to show how the laundry machine would appear in. 8, Moape’s statement of financial position, as at 30 September 2017. S. Moape Extract from Statement of Financial Position at 30 September 2017 Noncurentassets Cost Depreciation Net book value to date P P P Laundry machine a eee Cd [Total 221 rs oeec 2017 osiavvonen? [Turn over18 a ex 6. Ont October 2016, Save the Needy Welfare Society had the following assets and liabilities. |“? P Balance at bank 1800 Subscriptions due from members 150 Accumulated fund 1500 ‘Subscriptions prepaid 450 The treasurer provided the following information relating to the year ended 30 September 2017. P ‘Subscriptions received from members (including P200 paid for the year ending 30 September 2018) 4600 Receipts from concert 1200 Purchase of equipment 3000 Rent of premises 1008 Interest free loan from member (repayable 2021) 1500 Expenses of Concert 740 Insurance paid 340 Wages 2100 ‘The treasurer supplied the additional information 1 At30 September 2017 P ‘Subscriptions due from members 500 Rent due 84 Cash at bank 1912 2 Depreciation is to be charged on the equipment at the rate of 20% per annum. 3EC 207 osraovon7’ 18 . - year ended 30 September 2017. Save the Needy Welfare Society Income and Expenditure account for the year ended 30 September 2017 ‘BEC 2017 ooraovoIN7 {a) Prepare the income and expenditure account of Save the Needy Welfare Society for the Examiner: Use Turn over20 Fey Exemina se (b) Prepare the statement of the financial position of Save the Needy Welfare Society at 30 September 2017. Save the Needy Welfare Society ‘Statement of financial position at 30 September 2017 i . ‘BEC 2017 oataoronwt72 {c) Suggest two reasons why the surplus or deficit in the income and expenditure account of Save the Needy Welfare Society may be different from the balance in their receipts and payments account. 1 fa) [Total 18] ope 2017 comovronit724 BLANK PAGE ‘eqrison wo reproduce Fars where hd pay boned male protedad by copghl Ww inuded has Boon sought and Seared where possible. Fest teasonatie ator hes been macs ty the pubher (BEC) i race copyhe nocers, but any tems reqaing Cearapce have unwtingy Been Inchced, te publaher wl be pleased to make amends al he ears! posible opportu, e3Ec 2017 ostanvcunn7fe) Cia) (o 3 fa) A credit customer discovers that he has been charged P20 for purchases instead of P120. Which document will be issued by the customer to inform the supplier of the error? A credit note rv] B debit note invoice Ol D_ statement of account Which statement describes a deposit eccaunt? A abank account which pays interest OK B abank account from which unlimited withdrawals can be made © abank account for which holders are provided with cheque books O B abank account which requires a minimum of P10 000 £6 opéh Which accounting concept states that all assets and expenses be recorded in the ledger accounts at their purchase price? A. historical cost iv B_ matching / accrual © money measurement D. ealisation Which is an application of the concept of substance over form? charging rent incurred but not yet paid against profit for the year creating a provision for doubtful debts on trade receivables | recording as revenue goods delivered to a customer uo @ > vtiting off deprecation on machinery bought on hire purchase im BEC 3018 a4 OINNS = fl fy ft 1 rum over4 {h) A trader provided the following infor Revenue Purchases inventory — 1 Septomber 2017 31 August 2018 Retums inwards ‘ation for the year ended 31 August 2018 Pp ‘5000 4500 500 400 450 What was the gross profit for the year ended 31 August 2016? A P9250 B. - P3750 Cc P4250 D P4550 (i) How are debenture holders rewarded A commission B dividend interest D wages Which is an efficiency ratio? ‘current railo percentage of capital emplyed oo m > epECzo8 payment period for trade payables percentage of gross profilo sales "1 by a limited company? ao LJ [rotal: 10) estaovonute b ers e" : 7 +2 M Bashi ig @ farmer who maintains a full set of accounting records. On 1 September 2018, M Bashi issued an invoice, P2000, to Lesodi a credit custorner. (a) (i) State four items that may appear on the invoioe Issued by M Bashi. 1. 4.0 . AL (li) State the book of prime entry in which Lesedi will record the invoice received from M Bashi. M Bashi discovered thrse errors when checking his accounting records. {b) Complete the following table by identifying the type of each error. i I Frror I Type of over 4 | Gash received from Selelo, @ credit ‘customer, was credited to Selemo another customer Goods,P200, bought on credit were recorded 2 | as P2000. | Motor expenses ware debited fo motor vehicles account (3) M Bashi maintains a petty cash book using the imprest system. The imprest system is restored on the first day of each month. On 30 September 2018 he had petty cash vouchers for expenditure of P120 and a casi balance in hand of P80. {c) (i) State the amount of imprest? ty (ii) State how much cash was withdrawn from the bank to restore the imprest on” 4 October 20187 1) opEe 2088 astaoricnvs [urn overé : ole (ii) State four reasons why M Bash! maintains 2 petty cash book: 1 MBashi's total purchases for the year ended 30 September 2018 were asfollows. P Cash purchases 8.500 Credit purchases 48 600 On 20 September 2018 M Bashi's trade payables amounted to P3goc. M Bashi is allowed 30 days in which to pay his accounts. . (@) (i) Caloulate the payment period for trade payables. Your answer should be rounded up to the next whole day. {i Suggest two benefits to M Bashi of paying hie credit suppliers on tine. 1 REC 208 os asotonNt®z Examiner's (e) Complete the table by placing a tick ( ¥) under the correct heading to show where each item would appear in M Bash financial statements for the yeer ended 30 September 2018. tems may appear in more then one financial statement. ‘Statement of financial | Income Statement ‘tion [Expenses | Income | Assets * | Liabilities insurance prepaid on | 30 September 2018 Tent receivable acorued on | | 30 September 2018 _ wages aod on | 30 Septembar 2018 15) (Name three farm records which M. Bashi may maintain. esec 2018 7 ostwevoNits [Tum overB 3 A. Sbinaisa sole trader wino maintains a full set of accounting records including a three column cash book. On 4 Sepiember 2018, A. Sebina had the following debit balances in her cash book. P Cash 200 Bank 500 |A. Sebina’s transactions for the month of September 2018 included the following. Sep 3. Accheque for P576 was paid to Masego after deducting 4% cash discount. fa) 8 Purchased office equipment P95 by cheque. 413° Witndrew P450 from the business bank account to pay personal motor expenses. 20 A cheque received in August 2018 for P915 from K Lesego was dishonored and retumed by the bank. 28 Cash sales P1790. 28 Paid all the remaining cash into the bahK acnount except P80. Enter the above transactions in A. Sebina’s cash book. Balance the cash book at 30 Septomber 2048 and bring down the balanoes on 1 October 2018. (42) @BECa018 a14/ouORUTSpiuc038 2 suvoiioies ASebina Cash book Date Details Discount | allowed Cash Bank Date P Details Discount received Bank10 Examines |A, Sebina uses different methods of payments through the banking system. (6) State one situation in which A. Sebina would use each of the following methods of payment. (i) Standing order fal (i) Direct debit ‘The balance on A. Sebina’s bank statement on 20 September did not agree with the balance shown in the cash book for the folowing reasons: 4. The cheque paid to Masego on 3 September nad not yet been presented for payment. 2 the cash paid into the bank on 28 September had not yet been credited to A. Sebina. 3 There were bank charges, P300. (@) Calculate the bank balance on the bank statement on 20 September 2018. i es tUNHON® ABECWIE& = A MGofa is a sole trader who does not keep a full set of accounting records. She was able to | provide the following information. 4 AU April 2047 | at31 March 2018 - — = | Machinery attcost 35 000 40.000 Moior vehicle afoot ~ 50 000 30 000 7 - Inventory | 4.000 6.000 Gash at bank 30.000 3000 “Trade recaivables 5000 3500 Other receivables “400 200 | Trade payables 3.000 “4.000 | Othar Wade payables 600 300 nal information 1 Drawings for the year ended 31 March 2018 amounted to P18 000 2 On 31 March 2018 M Gola decided to provide depreciation on the non-current assets as follows: Motor vehicles - 20% per annum on cost ‘Machinery ~ 10% per ennum on cost {@) Calculate M Gofa's capital at 1 April 2017. * epeczs SoatamuanuTs Fxaminersa a2 (b) Prepare M Gofe’s statement of affairs at $1 March 2018 showing her profit or loss for the year. M Gofa ‘Statement of affairs as at 31 March 2018 ~ S BEC ZI : otaiotroNasFor Brame Use 43 After the preparation of the statement of affairs on 84 March 2018, M Gofa checked the few records she had maintained and found various errors. “peseyoind /ueujyoeul 0} pled ‘00S ‘enboyp b Jo apewi weed pey sp10081 ON -sj00g yy Ul epewL seq sey JUSUNSNIpE ON ‘eiqujesun pue peBewep eq 0} pundy sem B10 YOLEN LE UO pjeYy AloqUeAU! Up JO JIEH uve nueq ssouysng etp Uy poysodep "000 Std ‘300 Jo}OWI ayeANd §,2I0H py 30 aIes BL WOH ‘spacooid ey) $0 epew UeEg pel pcde! ON -aayddns ypsu0 ® 0} pied 000Zd Jo epew Uesq Pey picge ON +] oN paws | perais sepun | Jano peers | peers sopun 800 each error on the assets and capital at 31 March 2018, The first one has been {c) Complete the table by placing a fick ( /) In the correct colurnns to indicate the effect of completed as an example. feydeo uo peya 30868 UO PSUR La [urn over cetoonts © BEC 2018a4 (@) State four benefits to M Gota of starting to maintain a fll set of double entry records. ld {Total: 25) ORE02018 9814/0048- 8 . | _ Fe ; Examinore .*, 8 Lebo end Marang aie in partnership. They made the following agreement. Use 1 Profits and losses are shared in proportion to the capital contributed. 2 Interest on capital is to be allowed at 10% per annum. 3 Lebo isto be paid a salary of P2000 per month. ‘They provided the following information on 30 September 2018. : P Profit for the year 86 000 . Capital accounts at 1 October 2017 Lebo 220 000 ‘Marang 480.000 Current account at 1 October 2017 Lebo 1000 CR Marang 1800 CR Drawings Lebo 32.000 Marang 30.000 (2) () Prepare the pariners' current eccounts for the year ended 30 September 2018. Balance the accounts and bring down the balances on 1 October 2018. Lebo and Marang ‘Current accounts 6 9802018 cstaovonvia {Turn over18 (li) State the meaning of the balance on Marang's current account on 1 October 2018. On 1 October 2016, Neo joined the partnership. On that date, goodwill was valued at P36 000. Neo agreed to conbibute P150 000 as capital to be paid into the business bank account. Lebo, Marang and Neo agreed an the following. 4 Lebo, Marang and Neo were to share profits and losses in the ratio 3: 2 Goodwill was not to ke maintained in the books. 3. Interest on pariners drawings wes payable at 10% per annum (b) (i) State the meaning of the term goodwill. m (li) State two factors which may influence the amount of goodwill, {c) State two reasons winy the partners decided to charge interest on drawings. 3 Beet STRESS, 4 BAY oN, eRerama oes 0VORTS” W Examines (@) Propare the goodwht account. Lebo, Marang and Neo Goodwill account Date | Details Amount | pate Details Amount {e} State two reasons why Lebo, Marang and Neo prepared partnership agreement. (3 [Fotat: 21) + @pEcz018 ostwovonis [Turn overwz 6 Gn October 2017, Kgomo Softball Club had the following list of belances. Bank Stock ofrefreshments Softball equipment at valuation Subscriptions received in advance (a) Calculate the accumulated fund of Kgomo Softball Club on 1 October 2017. ‘Show your workings. P 6500 450 14.000 300 {b} State the meaning of the term subscription. ir} “The treasurer provided the following information rolating to the year ended 30 Septernber 2018. Purchase of new softball equipment Subscriptions Cost of refreshments Donations received Reni of softball ground paid Sale of refreshments Other operating expenses Cleaners’s wages e2sc 2018 61401108 e 9100 33 250 6250 2.950 6.000 7780 93250 8200 1 Examiners UseBAEC 2018 ce1gov0RN1s 19 {€} @ Prepare the receipts and payments acnaunt far Kgomo Sofihall Club for the year ended 30 September 2018. Balance the account and bring down the balance on 1 October 2078. Kgomo Softball Club Racaints and Payments Account far the year ended 30 September 2018. fTurn overFe 2 | Exarniner's (c) (i) Explain one difference between receipt and payment account ‘and income and expenditure account. (a) Suggest two reasons why the fhnancial statements would be useful to members of the committes of the Kgomo Softball Club. (0) Explain wtty members of Kgomo Softball Club may not make drawings. A Nene: {Totai: 49] \ «rican to rence fan whore i cay axed wate prfeind 6), cont Foascnable er ha Been made ty the ae be plocoed nace areas te erlost passe opacity nec 2018 ostaovonts \