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4.1 Choose a description from COLUMN B that matches the term in COLUMN A - NSC Accounting - Question 4 - 2017 - Paper 1
Question 4
4.1 Choose a description from COLUMN B that matches the term in COLUMN A. Write only the letter (A–D) next to the question number (4.1.1–4.1.4) in the ANSWER BOOK, f... show full transcript
Worked Solution & Example Answer:4.1 Choose a description from COLUMN B that matches the term in COLUMN A - NSC Accounting - Question 4 - 2017 - Paper 1
Step 1
4.2.1 Carrying value of the vehicle sold on 30 November 2016
Answer
To calculate the carrying value of the vehicle sold:
- Cost Price of Vehicle: R190,000
- Accumulated Depreciation (as of 1 March 2016): R72,000
- Depreciation Rate: 20% p.a.
- Depreciation for the period (from 1 March 2016 to 30 November 2016):
- Depreciation = Cost Price × Depreciation Rate × Time
- Depreciation = R190,000 × 0.20 × (9/12) = R28,500
- Total Accumulated Depreciation = R72,000 + R28,500 = R100,500
- Carrying Value = Cost Price - Total Accumulated Depreciation
- Carrying Value of Vehicle = R190,000 - R100,500 = R89,500.
Step 2
4.2.1 Total depreciation on 28 February 2017
Answer
For total depreciation calculation:
-
Depreciation on Remaining Vehicles (R138,000):
- Depreciation = R138,000 × 20% = R27,600
-
Depreciation on Equipment (R32,000):
- Depreciation = R32,000 × 10% = R3,200
-
Total Depreciation = R27,600 + R3,200 = R30,800.
Step 3
4.2.2 Prepare the Income Statement (Statement of Comprehensive Income)
Answer
Income Statement for the year ended 28 February 2017
Sales: R5,482,500
Cost of Sales: R3,159,375
Gross Profit:
- Gross Profit = Sales - Cost of Sales = R5,482,500 - R3,159,375 = R2,323,125
Other Operating Income:
- Rent Income = R186,000
- Bad Debt Recovered = R4,750
- Total Other Operating Income = R186,000 + R4,750 = R190,750
Gross Operating Income:
- Total = Gross Profit + Other Operating Income = R2,323,125 + R190,750 = R2,513,875
Operating Expenses:
-
Directors' Fees: R380,000
-
Audit Fees: R54,000
-
Bad Debts: R15,500
-
Salaries and Wages: R490,250
-
Consumable Stores: R61,700
-
Insurance: R19,220
-
Bank Charges: R7,760
-
Sundry Expenses: R140,085
-
Total Operating Expenses = R1,166,230
Operating Profit:
- Operating Profit = Gross Operating Income - Operating Expenses = R2,513,875 - R1,166,230 = R1,347,645
Interest Income: R? (to be calculated)
Net Profit After Interest Income:
- NPAT = Operating Profit + Interest Income = R1,347,645 + R? = R1,347,645
- Net Profit Before Tax: R1,347,645
Income Tax Expense: R336,000
- Net Profit After Tax: R864,000.