Machivandihala Ltd is a company incorporated in 2016 and has a 28 February financial year-end The company's accountant presented the following information to you as the accounting officer of the company MACHIVANDIHALA LTD EXTRACT OF BALANCES AS AT 28 FEBRUARY 2021: Retained eamings (1 March 2020) Share capital Ordinary shares (1 March 2020) Inventory (1 March 2020) Trade receivables control Petty cash Loan: Nandoni Bank SARS (income tax) (DI) Land and buildings al revaluation Equipment at cost Accumulated depreciation Equipment Revaluation surplus (1 March 2020) Income received in advance Allowance for credit losses Bank (D) Trade payables control Auditor's remuntation Sales Carnage on sales Settlement discount reoelved Allowance for settlement discount granted Purchases Salaries and vages Carriage on purchases Directors remuneration Settlement discount granted Stallonery Telephone R 235 400 666 300 37.500 263 800 6.400 110 900 28 900 1041 100 542 100 77 800 97 200 7500 5700 120 9001 1215 300 139400 1 341 000 2 200 1900 6.900 256 000 250 600 1 600 189.700 1800 7400 5.600 Additional information: 1. The allowance for credit losses must be adjusted to R6 600. A debtor who owes the business R10 300 was declared insolvent and must be written off as irrecoverable 2. The income tax for the financial year ended 28 February 2021 amounted to R121 100 and must still be recorded. 3. Authorised share capital consists of 400 000 NPV ordinary shares. Share capital stated above consists of ordinary shares issued at R3.5 per share. On 01 December 2020, the directors issued 57 000 shares at R4.8 per share, the shares were taken up by the public on 1 February 2021, this transaction has not been recorded 4. 5 The loan from Nandoni was acquired on 1 March 2018 at an interest rate of 8% per annum. Interest on all loans for the current financial year has not yet been accounted for. The loan is repayable in four annual equal instalments with effect from 1 March 2021. Directors made the following resolutions at year end Dividends declared at 80 cents per share and will paid at the end of April 2021 A total bonus amounting to R72 000 must be paid to directors on 30 April 2021 Only 30% of the auditors' fees were paid at the end of the year, with the remainder to be paid the auditors during the second week of March 2021 The above transactions have not been recorded. 6 7 Provision of R38 400 must still be made for depreciation on equipment. Inventory on 28 February 2021 consisted of the following Inventory (stock) on hand R45000 Stationary on hand R 4.400 8 The revaluation of land for the current year resulted in a revaluation surplus amounting to R99 000 QUESTION 6 Which alternative represents the correct amount for credit losses in the statement of profit or loss and other comprehensive income of Machivandihala Ltd for the year ended 28 February 2021? A. 23 100 O B.22 600 . O C. 11 700 D. 11 200 E. 10 700 - F. 22 100 Reset Selection QUESTION 7 Which alternative represents the correct accounting treatment of carriage on sales amount in the statement of profit or loss and other comprehensive income of Machivandihala Ltd for the year ended 28 February 2021? . O A. Added to the cost of sales amount . B. Added to the settlement discount granted . O C. Deducted from cost of sales amount . D. Added to purchases amount . O E. Disclosed a an expense under distribution, administrative and other expenses F. Deducted from revenue amount Reset Selection QUESTION 8 Which alternative represents the correct amount for stationary expense in the statement of profit or loss and other comprehensive income of Machivandihala Ltd for the year ended 28 February 2021? A. 8 100 - B.2 300 . C. 3700 D. 6 700 E. 7400 OF. 3000 Reset Selection QUESTION 9 Which alternative represents the correct amount for telephone expense in the statement of profit or loss and other comprehensive income of Machivandihala Ltd for the year ended 28 February 2021? A. 2 600 . B. 6 200 OC.5 600 D. 4600 - E.5 200 . O F.5 100 Reset Selection QUESTION 10 Which alternative represents the correct amount for interest on loan in the statement of profit or loss and other comprehensive income of Machivandihala Lid for the year ended 28 February 2021? A. 8 872 . B. 8 827 C.9 548 . D. 7600 E. 9 584 OF. 8 208 Reset Selection