The Independent Institute of Education 2016

MODULE NAME: MODULE CODE:

ACCOUNTING 1A ACBP5111
ACCOUNTING 1A ACBP5111d
ACCOUNTING 1A ACBP5111e
ACCOUNTING 1A ACBP5111f
ACCOUNTING 1A ACBP5111p

ASSESSMENT TYPE: TEST (PAPER ONLY)

TOTAL MARK ALLOCATION: 60 MARKS
TOTAL HOURS: 1 HOUR (+5 minutes reading time)
INSTRUCTIONS:
1. Please adhere to all instructions in the assessment booklet.
2. Independent work is required.
3. Five minutes per hour of the assessment to a maximum of 15 minutes is dedicated to
reading time before the start of the assessment. You may make notes on your question
paper, but not in your answer sheet. Calculators may not be used during reading time.
4. You may not leave the assessment venue during reading time, or during the first hour or
during the last 15 minutes of the assessment.
5. Ensure that your name is on all pieces of paper or books that you will be submitting. Submit
all the pages of this assessment’s question paper as well as your answer script.
6. Answer all the questions on the answer sheets or in answer booklets provided. The phrase
‘END OF PAPER’ will appear after the final set question of this assessment.
7. Remember to work at a steady pace so that you are able to complete the assessment with in
the allocated time. Use the mark allocation as a guideline as to how much time to spend on
each section.
Additional instructions:
1. This is a CLOSED BOOK assessment.
2. Calculators are allowed.
3. For multiple-choice questions, give only one (1) response per question. The marker will
ignore any question with more than one answer, unless otherwise stated. You should,
therefore, be sure of your answer before committing it to paper.
4. Answer All Questions.
5. Ensure that you have received a special answer booklet (with forms drawn up) for entering
your answers. If you have not received an answer booklet, request one from the invigilator
before starting the assessment. Answer all questions in the answer booklet provided.
6. Show all calculations, where applicable (marks may be awarded for this).

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Question 1 (Marks: 15)

Select one (1) correct answer for each of the following. In your answer booklet, write down only
the number of the question and next to it, the letter of the correct answer.
Read each question carefully before answering.

Q.1.1 Inventory should initially be recorded at which value: (1 ½)

(a) Selling price;
(b) Net realisable value;
(c) Cost;
(d) Rough estimation;
(e) None of the above.

Q.1.2 Which of the following items may be added to the cost of inventory? (1 ½)
(a) Wages of workers assembling the inventory;
(b) Salaries of sales staff;
(c) Salaries of office staff;
(d) Commissions paid to sales staff;
(e) All of the above.

Q.1.3 Purchases are classified as: (1 ½)

(a) Income;
(b) Expenses;
(c) Liability;
(d) Equity;
(e) Asset.

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Q.1.4 Calculate the cost of sales, if: (1 ½)

Sales = R200 000
Opening inventory = R20 000
Purchases = R175 000
Transport costs to our premises = R 2 000
Storing cost of inventory before sale = R5 000
Closing inventory = R32 000
(a) R35 000;
(b) R165 000;
(c) R163 000;
(d) R170 000;
(e) R227 000.

Q.1.5 A cash purchase of inventory will be recorded as follows in the perpetual (1 ½)

inventory system:
(a) DR Inventory CR Bank;
(b) DR Bank CR Inventory;
(c) DR Purchases CR Bank;
(d) DR Bank CR Purchases;
(e) DR Inventory CR Purchases.

Q.1.6 A return of inventory, purchased on credit, to the supplier will be recorded as (1 ½)

follows in the periodic inventory system:
(a) DR Inventory CR Creditor;
(b) DR Creditor CR Inventory;
(c) DR Purchases returns CR Creditor;
(d) DR Creditor CR Purchases returns;
(e) DR Inventory CR Purchases returns.

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Q.1.7 A return of inventory, purchased on credit, to the supplier will be recorded as (1 ½)

follows in the perpetual inventory system:
(a) DR Inventory CR Creditor;
(b) DR Creditor CR Inventory;
(c) DR Purchases returns CR Creditor;
(d) DR Creditor CR Purchases returns;
(e) DR Inventory CR Purchases returns.

Q.1.8 Import tariffs paid by cash on inventory will be recorded as follows in the (1 ½)
periodic inventory system:
(a) DR Bank CR Inventory;
(b) DR Import tariffs CR Bank;
(c) DR Bank CR Import tariffs;
(d) DR Inventory CR Bank;
(e) DR Inventory CR Import tariffs.

Q.1.9 In the perpetual inventory system the owner taking inventory for her own use (1 ½)
will be recorded as follows:
(a) DR Drawings CR Inventory;
(b) DR Purchases CR Inventory;
(c) DR Drawings CR Purchases;
(d) DR Inventory CR Drawings;
(e) DR Purchases CR Drawings.

Q.1.10 Which general ledger accounts would you not find in the periodic inventory (1 ½)
system?
(a) Inventory;
(b) Purchases;
(c) Sales;
(d) Sales returns;
(e) Cost of sales.

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Question 2 (Marks: 30)

You are the bookkeeper of Radebe Dealers. The business is a registered VAT vendor and trades
only with registered VAT Vendors. The business charges 14% VAT on all its sales. All amounts are
inclusive of VAT unless VAT is not applicable. As the bookkeeper you have been provided with
only the source documents for the month of March 2016 necessary for the preparation of the
journals specified below. The business uses the perpetual inventory system and trading inventory
is marked up by 50% on the cost price (before any given trade discounts), unless otherwise
specified. “DINV”, “DCRN”, “DCS”, “DR”, “JV” and “PCV” are the source document codes for
duplicate invoices, duplicate credit notes, duplicate cash slips, duplicate receipts, journal vouchers
and petty cash vouchers respectively.

SOURCE DOCUMENTS OF RADEBE DEALERS FOR THE MONTH OF MARCH 2016:

Source
Date Details Description Amount (R)
Doc. No.
Additional capital contribution in cash. Deposited directly
1 A. Radebe B/S 138 000.00
into the business’ bank account.
8 Cash DCS417 Cash sale of trading inventory. 127 338.00
Credit sale of trading inventory: R40 625 less an 8% trade
12 B. Solomon DINV525 ?
discount.
13 B. Solomon DCRN322 Trading inventory returned. 1 860.00
15 C. Matthews DCS418 Received a donation from C. Matthews. 1 500.00
19 D. Jonker DINV526 Credit sale of trading inventory. 112 860.00
Cash sale of trading inventory: R32 725 less an 8% trade
21 Cash DCS419 ?
discount.
24 E. Moosa DCS420 Received the rent income from E. Moosa. 13 680.00
Received a cheque from B. Solomon in part payment of
26 B. Solomon DR603 11 000.00
his account. (No discount was granted)
Received R130 000, less a 10% settlement discount, from
30 D. Jonker DR604 ?
D. Jonker a debtor.

Cash was banked on the 21st and 30th of March.

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Required:
Use the relevant transactions from those given above to complete the following journals for
the month of March 2016. You need not total the journals.
Round all amounts to the nearest rand.
Q.2.1 Cashbook receipts (CBR). (24)

Q.2.2 Debtors Journal (DJ) (6)

Question 3 (Marks: 15)

You are the bookkeeper of Radebe Traders and the owner is Ms Radebe. The business is a
registered VAT vendor and trades only with registered VAT vendors that can provide tax invoices.
The business charges 14% VAT on all its sales. The business uses the perpetual inventory system
and a mark-up of 100% on cost.

Making use of the source documents, you have recorded all the transactions correctly in the
creditors journal, creditors allowances journal, cashbook payments and general journal for the
business for the month of March.

The totals of the creditors journal, creditors allowances journal, cashbook payments and general
journal for the business for the month of March 2016 are as follows:

Note: The detail transactions and other selected information have been omitted.

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Creditors Journal of Radebe Traders — March 2016 CJ

Input Trading
Doc. no. Day Details Fol Creditors Control Sundry accounts
VAT inventory
Amount Fol. Details
31 Totals 394 440 48 440 346 000 151 900 Vehicles

Creditors Allowance Journal of Radebe Traders — March 2016 CAJ

Creditors Output Trading
Doc. no. Day Details Fol Sundry accounts
Control VAT inventory
Amount Fol. Details
31 Totals 13 395 1 645 11 750 114 Stationery

Cashbook payments of Radebe Traders — March 2016 CBP

Doc Creditors Input Trading Sundry accounts
Day Name of payee Fol Bank
no. Control VAT inventory Amount Fol. Details
31 Totals ? 129 000 38 480 262 460 151 900

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General Journal of Radebe Traders — March 2016 GJ

Doc. no. Date Details Fol Debit (R) Credit (R)
JV403 12 Office furniture 185 000
Input VAT 25 900
Capital 210 900
(Owner contributed Office Furniture)
JV404 21 Drawings 2 052
VAT output 252
Trading inventory 1 800
(Owner took goods for own use)

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Required:
Use the relevant totals from those given above to complete the posting of the journals to the
following general ledger accounts at the end of March 2016. You need not balance the accounts
at the end of the month.
Q.3.1 Inventory. (Assume an opening balance of R68 920.) (9)

Q.3.2 Input VAT. (Assume the opening balance to be R0.) (6)

Adapted with permission from EDGE Learning Media CC, © Copyright {EDGE resource files}

END OF PAPER

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