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Question 2 (26) VAT 2.1. Choose a word/phrase from the list of alternatives provided below to complete statements 2.1.1-2.1.4. Write only the word/phrase next to the question number in the answer book Alternatives: Evasion VAT zero-rated Input VAT Avoidance Output VAT VAT exempted . (2) 2.1.1 is VAT collected from customers. 2.1.2. Fees payable for education is an example of a good or service. 2.1.3. Tax is illegal and punishable by law. 2.1.4. _is VAT paid when goods are purchased by the business. Calculate the amounts missing in the table below and then complete the table. Note: The VAT rate is 15%. 2.2. Total amount paid to supplier (VAT inclusive) Example: 1 380 Actual Markup price (VAT Input VAT percentage exclusive) on cost Selling price (VAT exclusive) Output VAT Selling price paid by consumer (VAT inclusive) 1 200 180 100% 2 400 360 2 760 ? ? ? ? ? 2 000 ? 60% 200% 90 ? ? 2 070 (18) Question 3 [32] BANK RECONCILIATION The information provided below was extracted from the accounting records of Goldrand Traders. 1. Extract from the Bank Reconciliation Statement on 31 January 2019 R Balance as per statement (favourable) 1 400 Credit late deposit 1 650 Debit outstanding cheques No. 170 250 No. 178 1 800 No. 183 1 200 Balance as per bank account 2. The following provisional totals were extracted from the cash journals on 28 February 2019: Cash Receipts Journal R28 680 Cash Payments Journal R22 760 3. On comparison of the bank statement from Money Bank for February 2019 with the cash journals for February 2019 and the bank reconciliation statement as at 31 January 2019, the following differences were revealed: 4. 5. 6. Cheque no. 178 was presented for payment on 17 February 2019. Cheque no. 183 was issued to Young Chess Club as a donation. The Club has since closed and the cheque must be cancelled. A deposit of R1 650 appeared on the bank statement on 1 February 2019 and not in the journals for February 2019. No entry has been made for cheque no. 191, R1 260, dated 22 March 2019, issued in favour of Ron Traders for stock purchased. This cheque has not been presented for payment yet. In the Cash Receipts Journal an entry was made on 28 February in respect of a deposit, R3 460, which did not appear on the bank statement Cheque no. 195, R700, issued to Nandi Stores was lost in the post. The cheque was stopped and replaced by cheque no. 199. The entries have been made, but the cheque has not yet been presented to the bank for payment. A cheque drawn by a debtor, B Loss, was dishonoured by the bank owing to insufficient funds. The cheque was received in settlement of his debt of R550. R50 discount was allowed to B Loss Cheque no. 203 for R1 670, issued to creditor JWED Traders, appeared on the bank statement. The cheque, however, was recorded as R1 760 in the Cash Payments Journal. A tenant, Rose Florist, deposited the rent for February 2019 directly in the current account, R2 400 Bank charges amounting to R800 was charged by the bank. A deposit of R2 800 appeared on the bank statement. This was incorrectly recorded in the account of the business. The bank will correct its error. On 28 February 2019 the bank statement showed a credit balance of R8 400. 7. 8. 9. 10. 11. 12. Required: 3.1. Complete the Cash Receipts Journal and Cash Payments Journal of Goldrand Traders for February 2019. (16) 3.2. Post to the bank account in the General Ledger. (8) 3.3. Prepare the Bank Reconciliation Statement on 28 February 2019. (8) Question 4 (22) GENERAL LEDGER ACCOUNTS The following information was extracted from the accounting records of GL Traders during May 2019: Cash Receipts Journal - 31 May 2019 Cost of Sales Debtors Bank Sundry Control Accounts ? 8 100 5 400 11 310 6 750 Cash Payments Journal - 31 May 2019 Bank 21 000 Debtors Control 900 Wages 5 700 Trading Inventory 8 100 Sundry Accounts 6 300 Debtors Journal - 31 May 2019 Debtors Control Sales 14 217 14 217 Cost of Sales 10 044 594 Debtors Allowances Journal - 31 May 2019 Debtors Allowances Cost of Sales 372 Other information: Opening balances on 1 May 2019: Trading inventory R33 050 Debtors control R12 020 Required: Prepare the following accounts in the General Ledger. Total and balance the accounts at the end of the month. 4.1. Trading inventory account 4.2. Debtors control account (11) TOTAL: [120]
