Accounting 1 FS/March 2022

NSC – Marking Guideline

GRADE 12 - EXAMINATION

ACCOUNTING - MARCH 2022

MARKS: 120
MARKING PRINCIPLES:
1. Unless otherwise stated in the marking guidelines, penalties for foreign items are applied only if the
candidate is not losing marks elsewhere in the question for that item (no penalty for misplaced item).
No double penalty applied.
2. Penalties for placement or poor presentation (e.g. details) are applied only if the candidate is earning
marks on the figures for that item.
3. Unless otherwise stated, give full marks for correct answer. If answer is incorrect, mark workings.
4. If a pre-adjustment figure is shown as a final figure, allocate the part-mark for the working for that
figure (not the method mark for the answer). Note: if figures are stipulated in memo for components of
workings, these do not carry the method mark for final answer as well.
5. Unless otherwise indicated, the positive or negative effect of any figure must be considered to award
the mark. If no + or – sign or bracket is provided, assume that the figure is positive.
6. Where indicated, part-marks may be awarded to differentiate between differing qualities of answers
from candidates.
7. If candidates provide more that the required number of responses, inspect all responses to give
benefit to the candidate. Penalties may be applied for foreign entries if candidates earn full marks on a
question (max -2 per Q).
8. This memorandum is not for public distribution; as certain items might imply incorrect treatment. The
adjustments made are due to nuances in certain questions.
9. Where penalties are applied, the marks for that section of the question cannot be a final negative.
10. Where method marks are awarded for operation, marker must inspect reasonableness of answer.
11. Operation means 'check operation'. 'One part correct' means operation and one part correct. Note:
check operation must be +, -, x, ÷, or per memo.
12. In calculations, do not award marks for workings if numerator & denominator are swapped – this also
applies to ratios.
13. In awarding method marks, ensure that candidates do not get full marks for any item that is incorrect
at least in part. Indicate with a .
14. Be aware of candidates who provide valid alternatives beyond the marking guideline. Note that one
comment could contain different aspects.
15. Codes: f = foreign item; p = placement/presentation.

This marking guideline concists of 7 pages

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Accounting 2 FS/March 2022
NSC – Marking Guideline

QUESTION 1

1.1 NGIDI LTD.

STATEMENT OF COMPREHENSIVE INCOME (INKOMSTESTAAT) FOR
THE YEAR ENDED 28 FEBRUARY 2022
Sales (3 900 000 – 44 200 – 18 600 ) 3 837 200 
Cost of sales (2 600 000 – 12 400) (2 587 600) 
Gross profit 7 1 249 600 
Other operating income 143 776 
Rent income (156 368 – 12 992) 143 376 
Provision for bad debts adjustment 400 
Gross operating income 8 1 393 376 
Operating expenses (1 141 888) 
Sundry expenses 141 075
Bad debts (39 600  + 8 800) 48 400 
Audit fees (66 000 + 22 000) 88 000 
Director’s fees (562 400 – 29 600) 532 800 
Salaries and wages (132 500 + 9 700) 142 200 
Employers’ contribution (33 600 + + 776+ 97 ) 34 473 
Indien 8% Indien 1%
Bank charges (14 900 + 1 100 ) 16 000 
Advertising (24 460+ 1 880) 26 340 
Stock deficit (414 200 + 12 400 – 410 000 16 600 
Depreciation 96 000 
Operating profit 27 251 488 
Interest income balancing figure 32 512 
Profit before interest expense 284 000 
Interest expense (34 000) 
Profit before tax 250 000 
Income tax Profit before tax x 29% (72 500)  49
Net profit for the year 7 177 500

-1 Foreign, max - 2

1.2 RETAINED INCOME NOTE

Balance in the beginning of the year 943 200
Nett profit after tax 177 500 
Buy back of 75 000 x R1,50 (112 500) 
Dividends for the year (282 300) 
Interim dividends 123 300 
Final dividend balancing figure 159 000 
Balance at the end of the year 725 900 6

TOTAL MARKS

55

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Accounting 3 FS/March 2022
NSC – Marking Guideline

QUESTION 2
2. Ordinary Share Capital Note on 28 February 2022
1

900 000 Ordinary shares at the beginning 7 200 000

100 000 New shares issued balancing figure

1 800 000

(40 000)  Repurchased shares at R9,00  (360 000)

If one part correct

960 000  Shares at the end of the year 8 640

2. CASH FLOW STATEMENT FOR THE YEAR ENDED 28

2 FEBRUARY 2022

CASH FLOW FROM OPERATING ACTIVITIES

Cash generated from operations
Interest paid
Taxation paid – 22 800 + 430 000 – 47 200
OR + 22 800 – 430 000+ 47 200 (360 000)
Be aware of the use of brackets or ledger account formats
Dividends paid 133 500 + 192 000
OR: 133 500 + (394 000 – 202 000) (325 500)
Be aware of signs reversed & use of brackets or ledger account formats 7

CASH FLOW FROM INVESTING ACTIVITIES (1 470 000)

CASH FLOW FROM FINANCING ACTIVITIES 2 058 000

Shares issued see 2.1 1 800 000
Shares repurchased 360 000  + 32 000 
OR 40 000 x R9,80 (392 000)
one mark two marks
Loan increase
650 000
8

NET CHANGE IN CASH AND CASH EQUIVALENTS 143 500

CASH AND CASH EQUIVALENTS AT BEGINNING
(42 400)
(– 45 200 + 2 800)
CASH AND CASH EQUIVALENTS AT END
101 100
4
If no brackets, assume answer is an inflow of cash – award marks for workings only;

19

TOTAL MARKS

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Accounting 4 FS/March 2022
NSC – Marking Guideline
25

QUESTION 3

3.1.1 Calculate the following: (Show calculations to one decimal

point.)
Percentage operating profit on total sales

____ 3 250 000____

14 625 000 x 100 = 22,2%  no part marks% 2

Net asset value per share

____ 9 600 000____
1 200 000 x 100 = 800 cent operation one part 3
correct

Debt/equity ratio

3 840 000 : 9 600 000 = 0,4:1 operation one part correct must be x:1 3

3.1.2 Comment on the liquidity position of the business. Quote

THREE financial indicators (with figures) in your explanation.
Financial indicators and figures   
Valid comment 

Any three Financial indicators:

Current ratio improve from 2,0 : 1 to 2,3 : 1
Acid test ratio decrease from 1,3 : 1 to 0,8 : 1
Debtors’ collection period improved: 43 days to 32 days

General comment:
The liquidity has generally improved. The business is able to pay
short term debts with current assets.
Improvement in collections from debtors – reached the desired
30 days. 7
(Do not accept creditors’ payment period as an option.)

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Accounting 5 FS/March 2022
NSC – Marking Guideline

3.1.3 Some shareholders feel that the company paid back too
much of the loan. What would you say to them? Make
reference to TWO financial indicators with relevant figures to
motivate your response.
Financial indicators and figures  
Valid comment 

Financial indicator
Debt/equity: improved from 0,8 : 1 to 0,4 : 1 see 3.1.1
ROTCE: improved from 17% to 23%

General comment:
 The company is lowly geared (not making extensive use
of borrowed funds). It is also positively geared (ROTCE
is higher than interest rate).

 It was not necessary for the company to pay large portions of

the loan as long as it is generating a better return on
investment than the cost of borrowing (interest).

 Higher than interest rate on loan of 11% 5

TOTAL MARKS

20

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Accounting 6 FS/March 2022
NSC – Marking Guideline

QUESTION 4

4.1 List TWO points for good internal control over movable fixed assets.

Any TWO valid points 

 Maintain and updated fixed asset register/ depreciation/carrying value /condition
 Regular physical inspection
 Service and maintenance plans, and ensure that this is done regularly
 Insurance plan to cover loss / damage / accidents
 Keep a logbook /install tracking device
 Note drivers /users in a register /authorisation for use /record of time in/out.
 Only trained personnel to use technical equipment/drive vehicles
 Cameras to monitor use of equipment
 Secure premises for storage / locked garage / alarm system in premises 2

4.2 Calculate: Cost of land and buildings purchased on 30 November 2021.

WORKINGS ANSWER

6 745 000 – 5 650 000

R1 095 000 – 125 000 R970 000 
2

4.3 Calculate: Depreciation on vehicle for year ended 28 February 2022

WORKINGS ANSWER

R625 000 x 20% = R125 000; but carrying value is R25 000
R24 999
Maximum permitted: R25 000 
one part correct

4.4 Calculate: Loss on photocopy machine traded in on 1 November 2021

WORKINGS ANSWER
180 000 two marks (25% x 180 000 x 8/12) two marks
240 000 – (60 000 + 30 000) – 114 000 
90 000 three marks 150 000 four marks

OR 36 000
one part correct
Asset Disposal
240 000 one mark (60 000 + 30 000)
90 000 three marks
114 000 one mark
36 000
Be alert to other valid alternative presentations for calculations 6

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Accounting 7 FS/March 2022
NSC – Marking Guideline

4.4 Calculate: Depreciation on the new printing machine and on the

remaining old equipment for the year ended 28 February 2022.
WORKINGS ANSWER
Depreciation on the new printing machine:
R37 500
R450 000 x 25/100 x 4/12 one part correct
2
Calculate: Depreciation on the remaining old equipment for the year
ended 28 February 2022.
WORKINGS ANSWER
Depreciation on the remaining old equipment:
Choose and mark ONE option consistently

CP (1 900 000 – 240 000) = 1 660 000  one part correct

(+ 30 000 – 90 000) 117 500
one part correct
AD (1 250 000 – 60 000) = (1 190 000)  one part correct If x 25%
470 000 x 25%

OR:

(1 900 000 – 1 250 000) x 25% = 162 500 one mark + one m.mark
(240 000 – 60 000) x 25% = (45 000) one mark + one m.mark 5

TOTAL MARKS

20

TOTAL MARKS: 120

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