Exam (elaborations)
FAC1601 EXAM PACK
- Course
- FAC1601 EXAM PACK
- Institution
- University Of South Africa (Unisa)
Exam of 69 pages for the course FAC1601 EXAM PACK at Unisa (FAC1601 EXAM PACK)
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FAC1601 EXAM PACKWritten by CHANY MAGASO
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pg. 1
,Statement of Profit or Loss and Other
Comprehensive Income
Question 1
The following information pertains to a partnership, trading as K Naz
Capital: Kurt (1 April 20.1 300 000
Nazli (April) 250 000
Current Account: Kurt (1 April 20.1) 27 500
Nazli 15 000
Drawings: Kurt 65 000
Nazli 55 000
Office Furniture @ cost 190 000
Vehicles @ cost 200 000
Accumulated depreciation: Office furniture (30 September 20.1) 73 200
Vehicles (30 September 20.1) 10 800
Long-term loan (unsecured) 125 000
Debtors control 100 000
Bank (overdraft) 9 800
Allowance for credit losses 2 550
Stationery inventory (31 March 20.1) 3 250
Sales 462 800
Inventory (31 March 20.1) 42 500
Profit on sale of furniture 3 480
Delivery expenses (in respect of sales) 3 450
Settlement discount granted 5 620
Purchases 391 643
Delivery expenses (in respect of purchases) 6 500
Sales Returns 7 000
Purchases Returns 2 585
Settlement Discount Received 1 523
Rent expense 27 000
Bank charges 1 475
Depreciation (office furniture) 1 280
Interest expense ( paid on long term loan) 21 250
Salaries and wages 155 000
Telephone expenses 3 620
Maintenance and repairs (office furniture) 1 250
Fuel and supply vehicle expenses 14 400
Stationery (purchased) 2 540
Marketing fees 5 460
© 2015 Together We Pass. All rights reserved.
pg. 2
, Additional information
1. Stationery on hand at 31 March 20.2 - R450.
2. Inventory on hand at 31 March 20.2 - R39 700.
3. On 30 September 20.1 office furniture with a cost price of R20 000 was sold for R15 000. On
the same date office furniture to the amount of R40 000 was purchased on credit, in order to
replace the furniture that was sold. All the necessary accounting entries in respect of these
transactions were done correctly.
4. The following (outstanding) amounts have not yet been provided for:
4.1 Depreciation
On the office furniture – at 20% per annum on the diminishing balance method.
On the vehicles – according to the straight-line method. The expected lifespan of each vehicle
is estimated to be 10 years. The residual value of all the vehicles in total is estimated at R20
000. No vehicles were acquired or disposed of during the year.
4.2 The long-term loan was acquired from ABA Bank on 1 April 20.1 at 18% interest per annum.
The loan is unsecured and is repayable in 10 equal annual instalments from 1 April 20.2.
5. Credit losses of R5 000 must be written off. The closing balance of the allowance for credit
losses account must be increased with R2 200.
6. The partnership agreement stipulates that:
6.1 The partnership must create separate drawings and current accounts for each partner.
6.2 Interest on capital must be calculated at 8, 5% per annum on the opening balances of the
capitalaccounts.
6.3 Interest on current accounts must be calculated at 15% per annum on the opening balances of
thecurrent accounts.
6.4 A salary of R15 000 per annum must be paid to K Naz. The salary has been paid and is
included inthe salaries and wages account.
7. Drawings still to be accounted for:
Kurt – trading inventory, R2 500
Nazli – stationery inventory, R235
At the end of each financial year the drawings accounts must be closed off against the
applicablecurrent accounts.
REQUIRED:
Prepare the statement of profit or loss and other comprehensive income of K Naz for the year
ended31 March 20.2 in compliance with International Financial Reporting Standards (IFRS)
appropriate to thebusiness of the partnership. (30)Notes and comparative figures are NOT
required.
© 2015 Together We Pass. All rights reserved.
pg. 3
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