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FAC1601 Assessment 3_ Attempt review 2023
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FAC1601 Assessment 3_ Attempt review 2023
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Assessment 3
Started on Sunday, 7 May 2023, 8:00 PM
State Finished
Completed on Sunday, 7 May 2023, 9:34 PM
Time taken 1 hour 33 mins
Marks 23.00/30.00
Grade 76.67 out of 100.00
,Question 1
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Question text
Due to the high crime rate in South Africa, Thabo and Nandi have a close corporation trading as Best
Security CC. The services provided by the CC include VIP protection, Community security services,
Surveillance monitoring and Access control. The close corporation provides services within Gauteng in the
Sandton Area. The financial period for the CC ends 28 February.
The following extract of balances as at 28 February 2023 from the accounting records of
Bester CC is presented to you for assistance:
R
Loan to Nandi - 01 March 2020 25,000
Member’s contribution: Thabo 300,000
Member’s contribution: Nandi 275,000
Member’s contribution: Moses ??
Retained earnings (1 March 2022) 272,450
Trade debtors control 161,500
Trade creditors control 158,700
Loan from Thabo - 01 March 2022 120,500
Bank (favourable) 2,876,100
Long-term loan (Times Bank) 4,806,900
SARS (income tax) liability 120,300
Vehicles at cost 3,540,400
Accumulated depreciation: Vehicles (1 March 2022) 427,200
Furniture at cost 120,000
Accumulated depreciation: Furniture (1 March 2022) 26,800
Equipment at cost 1,700,600
Accumulated depreciation: Equipment (1 March 2022) 491,800
Inventory 314,800
Profit before tax (before taking into account the additional information) 3,259,800
Additional information
1. In the financial year ending 2022, Nandi’s father named Moses a professional within the security
industry with over 25 years of experience was admitted to the CC in July 2022 to assist in managing and
overseeing a new division. Moses contributed R70 000,00 cash, he further contributed a patrol vehicle to the
valued at R150 000.
2. The loan from Thabo was advanced to the CC on the 1st of November 2021 and is repayable on 31
October 2023.
3. On 01 August 2022 the electronic Gun Safe (Equipment) got damaged by floods and was not
reparable. This Safe was acquired on 30 June 2020 at a cost of R150 000.The carrying amount of the Safe on
, the day of the floods amounted to R95 000. Best CC received an insurance pay-out of R95 0000 on 15th
September 2022.
4. Depreciation for the year ended 28 February 2023 was calculated as follows:
Vehicles: R123 000
Furniture: R12 000
Equipment: R78 000
5. Nandi experienced personal financial problems during the year and borrowed R30 000 from the close
corporation. The loan was granted to Nandi on 31 May 2022 at an interest rate of 13% per annum. The
interest on this loan is capitalised. This transaction is still to be recorded.
6. On 30 November 2022, a profit distribution of R47 000 was made to each member of the close
corporation. These amounts should be regarded as loans from members with interest charged and capitalised
at 15% per annum. This transaction is yet to be accounted for.
7. The Inventory amount relates to the pepper spray, surveillance camera and other protection gear sold to
the public. The Net Realisable Value for the inventory amounted to R320 000,00 at year end.
8. The income tax assessment, received from SARS on 1 March 2023, indicated that the normal income
tax for the 2022 financial year amounted to R278 000.
9. All amounts should be rounded off to the nearest Rand.
Use the information above to answer questions 1 to 13.
Question 1
Which one of the following alternatives represents the correct amount of member’s contributions from the
new member Moses to be included in the statement of changes in net investments of members of Best CC for
the year ended 28 February2023?
A.
R 70 000
B.
R 150 000
C.
R 220 000
D.
R 130 000
Question 2
Complete
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