Question 1 (20 Marks) Prepare the Statement of Financial Position of Scampi Traders as at 28 February 2022. Note: The Statement of Comprehensive Income and the notes to the financial statement are not required. INFORMATION The information provided below was extracted from the accounting records of Scampi Traders on 28 February 2022, the end of the financial year. SCAMPI TRADERS PRE-ADJUSTMENT TRIAL BALANCE AS AT 28 FEBRUARY 2022 Debit (R) Credit Balance sheet accounts section Capital 240 950 Drawings 114000 vehicles at cost 285 000 Equipment at cost 165 000 Accumulated depreciation on venides 138 000 Accumulated depreciation on equipment 54000 Trading inventory 105 000 Debtors control 48 000 Provision for bad debts 6600 Bank 35 850 Creditors control 61 500 Mortgage loan: Maxi Bank (16%p.a.) 105 000 Nominal accounts section Sales 742 500 Cost of sales 350 000 Sales returns 4 500 Salaries and wages 129 000 Bad debts 1 500 Consumable stores 2 300 Rent expense 34 500 Motor expenses 26 700 Bad debts recovered 1 300 Telephone 9 300 Electricity and water 18 600 Bank charges 3700 Insurance 8 100 Interest on mortgage loan 7 800 Commission income 9000 1 358 850 1 358 850 ADDITIONAL INFORMATION AND ADJUSTMENTS According to physical stocktaking on 28 February 2022, the following were on hand: 1. 1.1 Trading inventory, R103 000 1.2 Consumable stores, R200. 2. Rent has been paid up to 31 March 2022. Note: The rental was increased by R350 per month with ea tom 01 February 2022 3. A debtor who owed R1 000 was declared insolvent. Forty percent (40%) of the amount owing was received from his insolvent estate on 27 February 2022 and recorded. The balance of his account must now be written O# 4. The provision for bad debts must be decreased by R300 5. Provide for outstanding interest on the loan from Maxi Bank. Interest is not capitalised. The loan was obtained on 01 March 2021. Loan repayments (excluding interest totaling R20 000 are expected to be made in the next financial year. 6. The telephone account for February 2022 was due to be paid on 03 March 2022, R800. 7. According to the bank statement, service fees of R200 were levied by the bank. This has not been recorded. 8. Received an amount for R500 from H. Smit whose account was written off previously. No entry was made for this. 9. A debtor whose account of R4 000 was overdue for one month must be charged interest at a rate of 15% per annum. 10. Provide for depreciation as follows: 10.1 On equipment at 10% per annum on cost. 10.2 On vehicles, R19 650. 11. The net profit for the year ended 28 February 2022, AFTER taking the above into account, was R102 050. Prepare the Statement of Changes in Equity for the year ended 28 February 2022. INFORMATION The information given below was extracted from the accounting records of Sunray Traders, a partnership business with Sunny and Raymond as partners Extract from the lediger of Sunray Traders as at 28 February 2022 CREDIT DEBIT R R Capital: Sunny 1 000 000 Capital: Raymond 600 000 Current ac Sunny (01 March 2021) 60 000 Current ac: Raymond (01 March 2021) 40 000 Drawings: Sunny 300 000 Drawings: Raymond 400 000 The following must be taken into account: (a The Statement of Comprehensive Income reflected a net profit of R900 000 for the year ended 28 February 2022 D The partnership agreement provided for interest on capital at 12% p.a. on the balances on the capital accounts. Note: Sunny increased his capital contribution by R200 000 on 01 June 2021 whilst Raymond decreased his capital contribution by R200 000 on 01 September 2021. The capital changes have been recorded. 10 The partners are entired to the following monthly salaries from 01 March 2021 to 30 November 2021: Sunny R25 000 Raymond R20 000 Note: The salaries of the partners were increased by 10% with elect from 01 December 2021. d) The balance of the profitloss must be shared equally between Sunny and Raymond. Question 3 (20 Marks) Prepare the Statement of Comprehensive Income for the year ended 28 February 2022. INFORMATION The trial balance, additional information and adjustments given below were extracted from the records of Metro Limited for the financial year ended 28 February 2022. METRO LIMITED PRE-ADJUSTMENT TRIAL BALANCE AS AT 28 FEBRUARY 2022 Debit (R) Credit (R) Balance sheet accounts section Ordinary share capital 2 200 000 Retained earnings 608 000 Land and buildings at cost 2 300 000 Equipment at cost 1 060 000 Vehicles at cost 880 000 Accumulated depreciation on equipment 440 000 Accumulated depreciation on vehicles 220 000 Trading inventory 210 000 Debtors control 265 000 Provision for bad debts 15 000 Bank overdraft 70 000 Creditors control 325 000 Loan: Ria Bank (18% p.a.) 250 000 South African Revenue Services (Company tax) 130 000 Nominal accounts section Sales 4580 000 Cost of sales 1 980 000 Sales returns 130 000 Advertising 140 000 Stationery 50 000 Bad debts 15 000 Discount allowed 20 000 Discount received 16 000 Electricity and water 180 000 Telephone 90 000 Interest on overdraft 1000 Directors' fees 240 000 Audit fees 60 000 Insurance 32 000 Salaries 950 000 Bank charges 13 000 Rent income 112 000 Municipal rates 90 000 8 836 000 8 836 000 ADDITIONAL INFORMATION AND ADJUSTMENTS According to physical stocktaking, the following were on hand on 28 February 2022 1. 1.1 Trading inventory R200 000 1.2 Stationery R3 000 2. Advertising includes a payment of R6 000 for six advertisements at R1 000 each that will be published monthly from January 2022 and June 2022. 3. Part of the building has been letto a tenant since 01 March 2020. Rent has been received up to 31 January 2022. Note: The rental increased by 10% on 01 December 2021. 4 On 28 February 2022 an amount of R1 200 was received from a debtor who was only able to pay 60% of his debt. The balance of his account must be written off. No entries were made for these transactions. 5. The provision for bad debts must be increased to R18 000. 6. Directors' fees amount to R21 000 per month. Make the necessary adjustment. 7. The loan from Ria Bank was obtained on 01 February 2022. Provide for the outstanding interest on loan. 8 A notice from the municipality indicated that the municipal rates for the year ended 28 February 2022 was calculated at R50 per R1 000 of the value of the land and buildings. Make the necessary adjustment . 9. Provide for depreciation as follows: 9.1 On vehicles at 20% per year using the diminishing balance method. 9.2 On equipment, R106 000 10. Based on the taxable income of the company, an amount of R6 114 is owed by the tax authority (South African Revenue Services) to Metro Limited for company tax. Question 4 (20 Marks) Use the information provided below to prepare the Cash Flow Statement of Rolex Limited for the year ended 31 December 2021 INFORMATION The following information was extracted from the records of Rolex Limited for the financial year ended 31 December 2021 ROLEX LIMITED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2021 R Sales 4 140 000 Cost of sales (2 020 000) Gross profit 2 120 000 Selling and administrative expenses (840 000) Operating profit 1 280 000 Interest expense (80 000) Profit before tax 1 200 000 Company tax (320 000) Profit after tax 880 000 STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER: ASSETS 2021 (R) 2020 (R) Non-current assets 3740000 2 940 000 Property, plant and equipment 3 440 000 2 940 000 Investments 300 000 0 Current assets 1 080 000 900 000 Inventories 480 000 500 000 Accounts receivable 510 000 320 000 Cash and cash equivalents 90 000 80 000 Total assets 4 820 000 3 840 000 EQUITY AND LIABILITIES Equity 3 120 000 2 600 000 Ordinary share capital 2 000 000 2 000 000 Retained earnings 1 120 000 600 000 Non-current liabilities 800 000 400 000 Long-term loan 800 000 400 000 Current liabilities 900 000 840 000 Accounts payable 480 000 560 000 Company tax payable 160 000 80 000 Dividends payable 260 000 200 000 Total equity and liabilities 4 820 000 3 840 000 Additional information 1 All purchases of inventories are on credit. ! The selling and administrative expenses include depreciation of R320 000. I Property, plant and equipment were purchased during the year but there were no disposals. : The total dividends for the year ended 31 December 2021 amounted to R360 000. I The issued share capital consisted of 100 000 ordinary shares. The market price of the shares on 31 December 2021 was R35