QUESTION $1$

$(44$ marks$)$

EVE Ltd is a local shop that sells tablecloths and napkins to clients. The company is

not registered for VAT and all transactions are in cash.

EVE Ltd uses the perpetual inventory recording system for tablecloths and the periodic

inventory recording system for napkins. Tablecloths are measured using the First$-$in$-$

first$-$out basis, and napkins using the weighted average method.

All tablecloths are sold at a mark$-$up of $50\%$ on the cost price and napkins at a mark$-$

up percentage of $30\%$ on the selling price.

The following transactions occurred during the year ended $31$ December $2024$ in the

order indicated and have not been accounted for:

The results of the inventory count on $31$ December $2023$ indicated the following:

Tablecloths $28$ units on hand $($uniform unit price of R$950$ each$)$

Napkins R$26487$

Receive $3$ tablecloths back that were consignment stock at a local caf$.$ They

initially took these tablecloths on $10$ December $2024.$

In January $2024,$ EVE Ltd bought napkins and received a $10\%$ discount. The price

before the discount was R$14250.$

EVE Ltd donated $2$ tablecloths to the local coffee shop. The cost price of these

tablecloths is R$950$ each.

EVE Ltd sold tablecloths with a total selling price of R$31350.$

EVE Ltd bought napkins with a purchase price of R$16870$ and incurred a delivery

fee of R$460.$

EVE Ltd sold napkins with a selling price of R$34650.$EVE Ltd bought $12$ tablecloths from a new supplier at a price of R$900$ per

tablecloth. EVE Ltd paid R$1200$ for the tablecloths to be delivered.

The owner took $4$ tablecloths and $200$ napkins to the value of R$5000$ to give as a

birthday gift to her sister.

EVE Ltd donated napkins, with a cost price of R$7645,$ to the local school.

EVE Ltd bought $10$ tablecloths with unique patterns for a special price of R$1125$

per tablecloth.

Thirteen $(13)$ tablecloths were sold during the yearly Christmas market. These

were sold at a discount of $25\%.$

During the night of $25$ December $2024,$ burglars got access to the shop and stole

some tablecloths. The tablecloths were displayed with the oldest tablecloths at the

front the burglars, therefore, stole some of the eldest tablecloths in stock. The

owners were traumatised and did not take stock count on the day.

EVE Ltd sold $4$ tablecloths to local supports.

On $31$ December $2024,$ EVE Ltd held an inventory count that indicated the

following:

Tablecloths $3$ units on hand

Napkins R$9902$

Included in the napkins inventory at year$-$end are napkins with a cost price of R$2$

$800$ that were damaged during the burglary. These damaged napkins can only be

sold if they get cleaned for R$700.$ The cleaned napkins can then be sold at a

discount of $40\%.$REQUIRED:

$1\mathrm{.}1$ Calculate the value of the tablecloths that were stolen on $25$ December $2024.$

Calculate by indicating the movement in inventory from $1$ January $2024-$

$31$ December $2024.$

Make use of the following format:

$(27$ marks$)$

$1\mathrm{.}2$ Prepare the Cost of Sales general ledger account for ONLY the napkins for

the year ended $31$ December $2024.$

Please note that dates are not necessary.

Round off to the nearest Rand where applicable.

Close off account at year end.

SAICA Competency Framework Reference: