REQUIRED: 2.1 Prepare the Retained Income Note for the year ended 28 February 2023 - NSC Accounting - Question 2 - 2023 - Paper 1

To calculate the change in the loan:

Change in Loan = Loan from Daisy Bank at end of year - Loan at beginning of year
= R7,200,000 - R6,348,000
= R852,000

To calculate the proceeds from shares issued:

Proceeds from Shares Issued = Total Ordinary Share Capital + Retained income balances - Previous Shareholder Capital
= R3,420,000

The Cash Effects of Operating Activities can be calculated by considering:

• Cash generated from operations: R2,340,000
• Interest paid: (R648,000)
• Income tax paid: (R23,600)
• Dividends paid: (R817,400)

This gives:

Total Cash from Operating Activities = Cash generated - Interest - Tax - Dividends
= R2,340,000 - R648,000 - R23,600 - R817,400
= R155,200

The Current Ratio is calculated as follows:

Current Ratio = Total Current Assets / Total Current Liabilities
= R1,479,600 / R822,000
= 1.8

Net Asset Value is calculated using the formula:

Net Asset Value = (Total Assets - Total Liabilities) / Number of Shares
= (R13,959,500 + R629,600) / 1,370,000 = R1,064.9 cents

The % return on total capital employed is calculated as follows:

ROTCE = (Net Profit after Tax / Average Capital Employed) * 100 = (R1,526,000 / R20,343,500) * 100 = 7.5%