(5) Q.2.1 For sales to increase within a company, there needs to be an increase in the , demand for their product(s). Discuss five (5) ways in which companies can ensure increased demand for their product(s). (18) Q.2.2 Moya Enterprises incurred the following income and expenses for the year ending 30 June 2019: R Wages and salaries 80 000 10 000 Sales returns 1 500 Interest on savings account Packing materials 5000 7 000 Rent paid 120 000 Cost of sales 800 700 Stationery Interest on overdraft Equipment expenses Sales 6 000 260 000 Page 2 of The Independent Institute of Education (Pty) Ltd 2019 Scanned with CamScanner 19 Advertising 18 000 Insurance 1 000 Water and electricity 1 600 . Required: Assume Moya Enterprises were to introduce the following measures for the following financial year ending 30 June 2020: Increase net sales revenue by 10%; Decrease cost of sales by 3%; Increase interest received by 4%; Decrease operating expenses by 2.5%, except for Wages & Salaries which increase by 5%; Interest payments to stay constant. Decrease operating expenses by 2.5%, except for Wages & Salaries which increase by 5% Interest payments to stay constant. Prepare a budgeted statement of comprehensive income for the financial year ended 30 June 2020 based on the above information. Show workings. Round all answers to the nearest Rand value. (4) Q.2.3 Use the information in Q.2.2 for the financial year ending 30 June 2019, and calculate the Gross Profit percentage for Moyo Enterprises. Show the formula and all workings. Round off to two (2) decimals. Q.2.4 Use the information in Q.2.2 for the financial year ending 30 June 2019, and calculate the Average Creditor's Settlement Period if Moyo Enterprises Average trade creditors were R30 000 at year-end and 40% of their purchases are done on credit. Purchases is equal to cost of sales Show the formula and all workings. Round off to the nearest day. (4) Q.2.5 Use the information in 2.2.2 for the financial year ending 30 June 2019, and calculate the average Debtor's Collection Period if Moyo Enterprises' average trade receivables were R60 000 at year-end and 50% of their sales are done on credit. Show the formula and all workings. Round off to the nearest day. The Independent Institute of Education (Pty) Ltd 2019 Page 3 of 9 Scanned with CamScanner 19 2019 (5) Q.2.6 The financial manager of Moyo Enterprises would like to calculate the debt to equity ratio for the entity. Explain this ratio to him. Your explanation should include reference to how it is calculated as well what is measured by this ratio. END OF PAPER (5) Q.2.1 For sales to increase within a company, there needs to be an increase in the , demand for their product(s). Discuss five (5) ways in which companies can ensure increased demand for their product(s). (18) Q.2.2 Moya Enterprises incurred the following income and expenses for the year ending 30 June 2019: R Wages and salaries 80 000 10 000 Sales returns 1 500 Interest on savings account Packing materials 5000 7 000 Rent paid 120 000 Cost of sales 800 700 Stationery Interest on overdraft Equipment expenses Sales 6 000 260 000 Page 2 of The Independent Institute of Education (Pty) Ltd 2019 Scanned with CamScanner 19 Advertising 18 000 Insurance 1 000 Water and electricity 1 600 . Required: Assume Moya Enterprises were to introduce the following measures for the following financial year ending 30 June 2020: Increase net sales revenue by 10%; Decrease cost of sales by 3%; Increase interest received by 4%; Decrease operating expenses by 2.5%, except for Wages & Salaries which increase by 5%; Interest payments to stay constant. Decrease operating expenses by 2.5%, except for Wages & Salaries which increase by 5% Interest payments to stay constant. Prepare a budgeted statement of comprehensive income for the financial year ended 30 June 2020 based on the above information. Show workings. Round all answers to the nearest Rand value. (4) Q.2.3 Use the information in Q.2.2 for the financial year ending 30 June 2019, and calculate the Gross Profit percentage for Moyo Enterprises. Show the formula and all workings. Round off to two (2) decimals. Q.2.4 Use the information in Q.2.2 for the financial year ending 30 June 2019, and calculate the Average Creditor's Settlement Period if Moyo Enterprises Average trade creditors were R30 000 at year-end and 40% of their purchases are done on credit. Purchases is equal to cost of sales Show the formula and all workings. Round off to the nearest day. (4) Q.2.5 Use the information in 2.2.2 for the financial year ending 30 June 2019, and calculate the average Debtor's Collection Period if Moyo Enterprises' average trade receivables were R60 000 at year-end and 50% of their sales are done on credit. Show the formula and all workings. Round off to the nearest day. The Independent Institute of Education (Pty) Ltd 2019 Page 3 of 9 Scanned with CamScanner 19 2019 (5) Q.2.6 The financial manager of Moyo Enterprises would like to calculate the debt to equity ratio for the entity. Explain this ratio to him. Your explanation should include reference to how it is calculated as well what is measured by this ratio. END OF PAPER