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VAT The information relates to Mphati Enterprises owned by partners John, Jacob and Jeremiah - NSC Accounting - Question 2 - 2024 - Paper 2
Question 2
VAT The information relates to Mphati Enterprises owned by partners John, Jacob and Jeremiah. The business is registered for VAT. They buy and sell standard and zero... show full transcript
Worked Solution & Example Answer:VAT The information relates to Mphati Enterprises owned by partners John, Jacob and Jeremiah - NSC Accounting - Question 2 - 2024 - Paper 2
Step 1
2.1.1 Calculate the VAT amount on the goods sold by the business.
Answer
To calculate the VAT amount on the goods sold by the business, we need to identify the total sales amount and apply the VAT rate to the standard-rated products.
- Total sales from standard-rate products is R548 000.
- The VAT on this is calculated as follows: VAT = ext{Total Sales} imes rac{15}{115} Total VAT = R548,000 \times 0.15 = R82,200
Now, we also need to calculate VAT on the zero-rated products, which do not attract VAT:
- Thus, total VAT amount on goods sold by the business = R82,200.
- Therefore, the total VAT amount collected is R101,400.
Step 2
2.1.2 Calculate the amount payable to or receivable from SARS on 30 April 2024.
Answer
To calculate the amount payable to or receivable from SARS:
- Start with the balance due to SARS from April 1, which is R5,340.
- Add the VAT amount calculated from sales:
- Add R101,400 (VAT from sales above).
- Subtract any amounts from Debtors' accounts written off (R4,800) and Discounts received (R31,510):
- Total = 5340 + 101400 - 4800 - 31510
- = 14,550.
Thus, the amount payable to SARS on 30 April 2024 is R14,550.