GAUTENG DEPARTMENT OF EDUCATION

PROVINCIAL EXAMINATION
NOVEMBER 2020
GRADE 10

ACCOUNTING
PAPER 2

TIME: 2 hours

MARKS: 150

10 pages

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 ACCOUNTING 2
PAPER 2 GRADE 10

INSTRUCTIONS AND INFORMATION

Read the following instructions carefully and follow them precisely.

1. Answer ALL the questions in the ANSWER BOOK provided.

2. Show ALL workings in order to achieve part-marks.

3. Non-programmable calculators may be used.

4. You may use blue/black ink to answer the questions.

5. Where applicable, show ALL calculations to ONE decimal point.

6. Write neatly and legibly.

7. Use the information in the table below as a guide when answering the
question paper. Try NOT to deviate from it.

QUESTION 1: 45 marks; 36 minutes

Topic: This question integrates:
Concepts and Ledger Concepts
General Ledger Accounts

QUESTION 2: 46 marks; 37 minutes

Topic: This question integrates:
Debtors reconciliation Debtors’ control account
Internal control Debtors’ list
Internal control relating to debtors

QUESTION 3: 39 marks; 31 minutes

Topic: This question integrates:
Concepts and Concepts
Fixed Assets Fixed Asset Register
Depreciation on Fixed Assets
Fixed Asset Note

QUESTION 4: 20 marks; 16 minutes

Topic: This question integrates:
Internal control and Controls on Fixed Assets
Ethics
Controls on Inventory
Ethics relating to assets

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QUESTION 1: CONCEPTS AND GENERAL LEDGER ACCOUNTS

(45 marks : 36 minutes)

1.1 CONCEPTS

Choose an answer from the list that completes each statement below. Write
only the answer next to the question number (1.1.1 to 1.1.5) in the ANSWER
BOOK.

selling price cost price income expense

original invoice duplicate invoice credit note

1.1.1 Sales figure is regarded as ... .

1.1.2 Goods sold are always recorded at … price in the Trading Stock
account.

1.1.3 Trading stock donated by the business is regarded as an ... .

1.1.4 The source document used to record credit purchases is ... .

1.1.5 The source document used to record credit sales is ... .

(5 x 1) (5)

1.2 GENERAL LEDGER ACCOUNTS

You are provided with information relating to Molefi Traders for June 2020.
The business buys and sells household appliances for cash and on credit.
The business is located in Gauteng and their financial year ends on 30 June.
The business uses a mark-up of 60% on cost price.

REQUIRED:

Complete the following General Ledger accounts for June 2020 and balance
them properly:

1.2.1 Trading Stock (23)

1.2.2 Creditors’ control (17)

INFORMATION A:

Balances on 1 June 2020 in the General Ledger

 Trading Stock R87 600

 Creditors’ control R38 900

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INFORMATION B:

Totals in the subsidiary journals on 30 June 2020

Cash Receipts Journal

Bank Sales Cost of Debtors’ control Sundry
Sales Receipts Discount accounts
R68 200 R42 000 R26 250 R18 400 R600 R?

Cash Payments Journal

Bank Trading Debtors’ Creditors’ control Sundry
Stock control Payments Discount accounts
R44 300 R4 600 R1 800 R22 620 R980 R?

Debtors’ Journal
Sales Cost of sales
R18 400 R?

Debtors’ Allowances Journal

Debtors’ allowances Cost of sales
R1 800 R1 125

Creditors’ Journal
Creditors’ Trading Stationery Equipment Sundry
control Stock accounts
R? R12 800 R4 400 R8 900 R3 100

Creditors’ Allowances Journal

Creditors’ Trading Stationery Equipment Sundry
control Stock accounts
R2 800 R800 R300 R1 200 R?

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Petty Cash Journal

Petty Trading Stationery Wages Sundry
cash Stock accounts
R1 260 R260 R400 R380 R220

General Journal
Debtors’ control Creditors’ control
Debit Credit Debit Credit
R1 490 R890 R780 R1 420

INFORMATION C:

The accountant did not record the following transactions in the General Journal:

 The owner took goods for R1 650 at cost price per personal use.

 It was discovered that goods bought on credit for R3 200 was wrongly recorded
as stationery.

Note: record the transactions directly into the General Ledger accounts. 45

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QUESTION 2: DEBTORS’ RECONCILIATION (46 marks : 37 minutes)

The information below has been taken from the books of Stephan Stores.

REQUIRED:

2.1 Respond to the following questions below:

2.1.1 Why should the Debtors’ Control and the Debtors’ List always agree?
Explain in ONE point. (2)

2.1.2 Reconcile the Debtors’ Control to the Debtors’ List for the month of
July 2020. (40)

2.1.3 Stephan feels that his debtors are not paying timeously. List TWO
measures he can implement to collect his money earlier from debtors. (4)

INFORMATION:

GENERAL LEDGER OF STEPHAN STORES

BALANCE SHEET ACCOUNTS SECTION

DR DEBTORS’ CONTROL B6 CR
Bank and
2020 2020
01 Balance b/d 212 080 31 discount CRJ 224 550
Jul Jul
allowed
Debtors’
30 Sales DJ 277 300 DAJ 8 000
Allowances
Journal Journal
GJ 4 700 GJ 2 400
Debits Credits
Balance c/d 259130

494 080 494 080

2020
01 Balance b/d 259130
Aug

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DEBTORS’ LIST AT 31 JULY 2020

NAME OF DEBTOR DEBIT CREDIT

C. Botha 20 600
H. Dipho 12 000
N. Dladla 64 000
D. Mkhize 3 200
E. Mthimkulu 6 500
L. Nkozi 73 000
G. Stuurman 13 400
B. Zunaid 90 000
TOTAL 279 500 3 200

ERRORS AND OMISSIONS

A The balance of the Debtors’ Control account was overstated on 01 July by

R1 080.

B The credit balance of D. Mkhize in the Debtors’ List must be transferred to the
Creditors’ ledger.

C The total column of sales in the Debtors’ Journal was undercast by R25 000.

D A credit invoice of R7 700 for goods purchased by B. Zunaid has not been
recorded.

E A receipt of R15 000 for L. Nkozi was correctly recorded in the debtors’
account, but was omitted from the Subsidiary Journal.

F An entry of R1 000 in respect of merchandise returned by N. Dladla was not

entered in the Subsidiary Journal and was entered on the wrong side of his
account.

G No entry has been made for a refund of R5 000 that was overcharged to
C. Botha.

H E. Mthimkulu returned stock of R4 800. This was correctly recorded in the

Subsidiary Journal but was recorded as R3 9 00 in the debtors’ account.

I No entry has been made for interest charged on G. Stuurman’s arrears of

R8 000. This amount was 3 months in arrears, interest is charged at 5% per
annum.

J H. Dipho issued a cheque of R8 550 towards his account after deducting 5%

discount. The discount was recorded in the Ledger but not in the Subsidiary
Journal.
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QUESTION 3: CONCEPTS AND FIXED ASSETS (39 marks; 31 minutes)

3.1 CONCEPTS

Indicate whether the following statements are TRUE or FALSE. Write only 'true'
or 'false' next to the question numbers (3.1.1 to 3.1.4) in the ANSWER BOOK.

3.1.1 Fixed assets are tangible assets that are purchased by the business
for the purpose of resale.

3.1.2 The accumulated depreciation is recorded in the Income Statement.

3.1.3 An Asset Register is a record of all the assets owned by the business.

3.1.4 The diminishing balance method is used to calculate depreciation for

Land and Buildings. (4 x 1) (4)

3.2 FIXED ASSET REGISTER

Colin’s Car Dealership

The information provided is extracted from the financial records of Colin’s Car
Dealership

REQUIRED:

Use the information below to complete the Fixed Asset Register provided in
your ANSWER BOOK. Their financial year ended on 29 February 2020. (8)

INFORMATION:

Colin’s Car Dealership purchased a delivery van on 31 August 2018 on credit

from Falcon Motors for R150 000. Depreciation is calculated at 20% p.a. on
the diminishing balance method.

3.3 FIXED ASSET NOTE

Martin Logistics

The information relates to Martin Logistics for the financial year ended 29
February 2020.

REQUIRED:

3.31 Calculate the total depreciation for equipment for the year ending 29
February 2020. (6)

3.3.2 Calculate the price of ONE vehicle. (2)

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3.3.3 Calculate the total depreciation for vehicles for the year ending
29 February 2020. (5)

3.3.4 Complete the Fixed Asset Note. (14)

INFORMATION:

A
EXTRACTED FROM TRIAL BALANCE ON 29 FEBRUARY 2020:
Balance Sheet Accounts Section Debit Credit
Land and buildings 5 500 000
Vehicles (cost) 1000 000
Equipment (cost) 2000 000
Accumulated depreciation on vehicles (1/3/2019) 375 000
Accumulated depreciation on equipment (1/3/2019) 1 200 000

B ADJUSTMENTS AND ADDITIONAL INFORMATION:

Land and buildings

During the year a payment for R500 000 was made to Gifts Renovators,
R300 000 was for a new storeroom and the balance of R200 000 was for
repairs to the roof of the old warehouse.

Equipment

On 01 December 2019 a new 3D printer was purchased for R90 000. A

technician was hired to install and setup the printer before it could be used.
The business was invoiced R25 000 for the installation and setup. The
installation and setup were completed on the day the printer was bought.

Vehicles

The business owns THREE identical delivery vans. All three were purchased
on the same day and at the same price. A new delivery van was purchased
on 1 September 2019 at the same price of each of the other vans. This
purchase has already been recorded.

Depreciation for the year is as follows:

 Equipment at 10% per annum on the diminishing balance method.

 Vehicles at 25% per annum on cost.
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QUESTION 4: INTERNAL CONTROL AND ETHICS ON FIXED ASSETS AND
INVENTORY
(20 marks; 16 minutes)

41 Read the scenario and answer the questions below:

Rogers Mokoena is the owner of Rogers Traders. The business has two delivery
vehicles. According to the vehicles’ policy of the business, drivers are allowed to
drive the delivery vehicles home especially when the last delivery to customers
finishes late. The policy clearly states that the delivery vehicles must not be used
for private trips.

The owner discovered that one of the delivery vehicles (driven by John) has
travelled 2 000 kilometres more for June 2020 compared to the average
kilometres travelled each month. After an investigation, John confessed that he
used the delivery vehicle to visit his family in Eastern Cape.

Rogers Traders has two employees who are responsible for the storeroom. They
receive stock and issue stock to the sales department. The large orders that
need to be delivered to customers are collected by the drivers from the
storeroom. After the physical stocktaking at the end of June 2020, it was
discovered that 15 gas heaters were missing. The employees responsible for the
storeroom could not account for the missing gas heaters.

REQUIRED:

4.1.1 Explain how John’s unethical conduct will affect the business financially.
Provide TWO points. (4)

4.1.2 Provide THREE internal control measures that can be implemented by

the owner of the business to avoid any abuse of delivery vehicles by
employees. (6)

4.1.3 Provide TWO steps that can be taken against John for his unethical
conduct. (4)

4.1.4 Discuss THREE internal control measures that can be implemented by

the owner to prevent theft of trading stock. (6)

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TOTAL: 150

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