ANNEXURE F: FORMATIVE ASSESSMENT $1$

QUESTION $4$

SharkGlow Ltd $("$SharkGlow$")$ is a company that sells soft toys in the Aquarium in Cape

Town. SharkGlow Ltd has a February year$-$end.

You are presented with an extract of the following pre$-$adjustment trial balance of

SharkGlow Ltd for the year ended $29$ February $2024$:ANNEXURE F: FORMATIVE ASSESSMENT $1$

The following transactions for the financial year ended $29$ February $2024$ have

not yet been recorded:

Transaction $1$:

Sipho, the owner of SharkGlow, inherited R$60000$ on $30$ June $2023$ and decided to

use this money to expand SharkGlow. Sihpo deposited the R$60000$ in the bank

account of SharkGlow. They expanded by buying another vending machine. The

vending machine cost R$50000$ and the delivery costs were R$1000.$

Transaction $2$:

On $1$ July $2023,$ SharkGlow got an additional R$40000$ loan from AB Bank Ltd$.$ This

loan is repayable in monthly installments of R$2000,$ with the first repayment date being

$29$ February $2024.$ This loan bears interest at a rate of $10\%$ per annum.

Transaction $3$:

SharkGlow bought soft toys to the value of R$14000,$ on credit from Flow Wholesales

Ltd$,$ for the new vending machine.

Additional information:

No interest has been accounted for to date.

On $1$ March $2023,$ equipment consisted of $6$ vending machines that SharkGlow

bought when they started the company. All vending machines have a useful life of

$3$ years and a nil residual value.REQUIRED:

$4\mathrm{.}1$ Prepare the selected general ledger accounts of SharkGlow Ltd to account for

transactions $1-3$ at $29$ February $2024.$

The following general ledger accounts must be prepared:

$4\mathrm{.}1\mathrm{.}1$ Bank

$4\mathrm{.}1\mathrm{.}2$ Equipment: Vending machine

$4\mathrm{.}1\mathrm{.}3$ Loan payable

$4\mathrm{.}1\mathrm{.}4$ Interest expense

Please note that dates are not necessary.

Round off to the nearest Rand where applicable.

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Use the Trail Balance balances provided as starting point.

Close off all accounts.

$4\mathrm{.}2$ Assume SharkGlow Ltd made a profit of R$25645$ for the year ended $29$

February $2024$ after all transactions have been accounted for.

Prepare an extract from the Statement of Financial Position of SharkGlow Ltd

as at $29$ February $2024,$ showing ONLY the Equity part of the statement.

Subtotals and totals are not required.

Notes to the financial statement extract are not required.

Use and reference amounts from $4\mathrm{.}1$ where applicable.

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