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1.1 Indicate whether the following statements are TRUE or FALSE - NSC Accounting - Question 1 - 2017 - Paper 1
Question 1
1.1 Indicate whether the following statements are TRUE or FALSE. Write only 'true' or 'false' next to the question number (1.1.1-1.1.3) in the ANSWER BOOK. 1.1.1 A ... show full transcript
Worked Solution & Example Answer:1.1 Indicate whether the following statements are TRUE or FALSE - NSC Accounting - Question 1 - 2017 - Paper 1
Step 1
1.2.1 Calculate the following on 30 June 2017: - Correct totals for the CRJ and CPJ
Answer
To calculate the correct totals for the CRJ and CPJ on 30 June 2017, we need to consider all transactions up to that date.
The CRJ total can be computed as follows:
- Total = 90 750
The CPJ total is found by:
- Total = 85 920
Step 2
1.2.1 Bank account balance
Answer
The bank account balance on 30 June 2017 can be calculated by considering the starting balance and factoring in the outstanding deposits and cheques:
Starting balance = Unfavourable balance from the bank statement = -R1 450 Outstanding deposits = R30 000 + R16 200 = R46 200 Outstanding cheques = R9 750 + R8 870 + R1 220 + R2 290 + R7 550 = R29 680
Thus, the bank account balance can be computed as:
Bank Account Balance = -R1 450 + R46 200 - R29 680 = R15 070
Step 3
1.2.2 Prepare the Bank Reconciliation Statement on 30 June 2017.
Answer
The Bank Reconciliation Statement is set up in the following format:
Bank Reconciliation Statement
Date: 30 June 2017
| Debit | Credit |
|---|---|
| Balance per Bank Statement | R9 740 |
| Outstanding deposits | R46 200 |
| Outstanding cheques | R29 680 |
| Balance per Bank Account | R15 070 |
| ---------------------------------- | -------------- |
| Total | R41 400 |
The necessary adjustments have been made to arrive at the correct bank balance as per the records.
Step 4
1.2.3 Explain the problem relating to deposits. Quote evidence.
Answer
The problem relating to deposits is primarily due to late deposits, which can create cash flow challenges.
For example:
- The deposit of R30 000 made on 17 May was only reflected on the bank statement one month later, creating a delay in cash flow management.
- The deposit of R16 200 which needed to be reconciled on 31 May also faced a similar delay.
As a result, this leads to potential operational issues within the business.
Step 5
1.2.3 Explain TWO strategies to prevent this in future.
Answer
To mitigate issues related to deposit timing, the following strategies are recommended:
-
Implement a system for timely deposits: Ensure that deposits are made promptly, ideally daily, to avoid delays.
-
Use electronic transfer options: Encourage the use of electronic fund transfers (EFT) which allow immediate posting of transactions, reducing the chance of delays and errors associated with physical deposits.