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past exam paper for accounting 100
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2020 Accounting 100 Question bank 2 (Additional Question 5 Chapters 2 – 8)-Updated Question 2QUESTION 2 (38 MARKS)
AB Entity, as well as all of AB Entity’s suppliers, are registered as vendors in accordance with the
VAT Act. AB Entity’s current reporting date is 31 December 20.20. The owner will probable approve
the financial statements for 20.20 for distribution, on 28 February 20.21.
AB Entity uses the perpetual inventory system.
On 1 December 20.20 the following balances, amongst others, appeared in the records of
AB Entity:
Acc no Dr Cr
Bank A1 525 000
Trade inventories A30 396 000
Trade receivables A35 482 585
Allowance for doubtful debts A35B 38 605
Loan from bank L5 1 378 125
Trade- and other payables L15 385 600
VAT input A60 66 948
VAT output L30 122 696
The following transactions and events still have to be recognised in AB Entity’s records and, where
applicable, include VAT at 15%:
1 Trade inventories with a cost price of R11 200 were donated to a local school on 5 December
20.20.
2 Trade inventories that were purchased from Payable KW, were received on 7 December
20.20. The invoice from Payable KW reflects an amount of R126 673 and is payable on
5 January 20.21.
3 On 15 December 20.20 trade inventories were sold on credit to Receivable DG and delivered
on the same day. The invoice reflects the amount as R292 150 and is payable on 13 January
20.21. The cost of the goods sold, amount to R101 616.
4 On 19 December 20.20 an amount of R26 646 was paid to LG Caterers in respect of a
function which was held for AB Entity’s employees on the same day.
5 The VAT due, as per the November 20.20 VAT return, was paid to SARS on 24 December
20.20 by means of an electronic fund transfer.
6 Receivable DE’s debt, to the amount of R24 219, was written off as irrecoverable. The owner
authorised this write off on 27 December 20.20.
7 The owner’s drawings for December 20.20, to the amount of R50 000, was paid into the
owner’s personal bank account on 29 December 20.20 by means of an electronic fund
transfer.
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