Question 1: a) Ignore VAT Health Ltd has a year-end of 30 November. The notes to the statement of financial position as at 30 November 2019 showed that Health Ltd has an authorised share capital of 20 000 000 Class A shares with voting rights, and no right to a fixed distribution. On 30 June 2020, Class A shares were offered to the public at a price of R19 each. On 15 August 2020, the closing date for applications, 6 000 000 Class A shares had been applied for. The share offer had been oversubscribed by 20%. The directors decided not to issue the oversubscribed portion. The share issue was underwritten for a commission of 2%, and other share issue costs amounted to R957 000 Prior to the 2020 financial year, the only other share issue that had taken place had been during the year ended 30 November 2017. 3 000 000 Class A shares had been issued for R10 per share. Total share issue costs had amounted to R1 200 000, and these were paid in the 2018 financial year. Fill in the blanks below in the "Share capital: Class A" column of the statement of changes in equity of Health Ltd for the year ended 30 November 2020. Health First Ltd: Statement of changes in equity (extract) for the year ended 30 November 2020 (in rands) Share capital: Class A Balance, 1/12/2019 Proceeds from share issue Share issue costs Balance, 30/11/2020 XXX XXX (Write the full rand values, including zeroes but not including the "R". If a figure should appear as a negative, use a minus sign before the figure to indicate that it should be negative. Do not leave any blanks empty: insert a zero if the blank should not contain a value or if you do not know the answer.) b) Assume a VAT rate of 15% Assume all parties are VAT vendors, and all rand values include VAT Business C buys and sells cleaning products. The business uses the periodic recording system and applies a consistent mark up of 40% on cost. On 15 November 2020, the business purchased 5 000 bottles of kitchen cleaner for a total of R115 000 on credit. On 29 November 2020, the business sold 4 000 bottles of the kitchen cleaner to a customer for cash. The journal entry to process the sale is as follows: DR Bank (A) CR Sales income (P/L) CR SARS (VAT) (L) (Write the full rand value, including zeroes but not including the R. Do not leave any blanks empty: insert a zero if the blank should not contain a value or if you do not know the answer.) Ignore VAT ABC (Pty) Ltd (ABC) has a year-end of 30 November. ABC has invested in some of the Class A shares of XYZ Ltd. On 30 November 2019, the carrying amount of this investment was R458700, and the share price was 1668 cents. On 18 January 2020, when the share price had dropped to 1581 cents, ABC made a further investment in XYZ Ltd by doubling the number of Class A shares of XYZ Ltd that it owns. On 30 June 2020, ABC sold a number of its XYZ Ltd shares, earning a gain of R32400. At its financial year-end, 30 November 2020, ABC reported the investment at R535551, and reported an investment loss of R47450 arising from the year-end fair value adjustment. Complete the investing activities section of the statement of cash flows of ABC below. ABC Ltd: Statement of cash flows (extract) for the year ended 30 November 2020 (in rands) Investing activities section Acquisition of investments Proceeds on disposal of investments Net cash flow from investing activities (Write the full rand values, including any zeroes but not including the "R". If a figure should appear as a negative, use a minus sign before the figure to indicate that it should be negative. Do not leave any blanks empty: insert a zero if the blank should not contain a value or if you do not know the answer.) d) Ignore VAT During its 2020 financial year, the carrying amount of a company's PPE increased from R195 000 to R397 000. During the year, the company sold PPE with a carrying amount of R59 000. The statement of comprehensive income for 2020 reported a loss on disposal of PPE of R36 000, depreciation expense of R77 000, and an impairment loss of R10 000. All acquisitions of PPE during the 2020 year were paid for in cash. The cash outflow on acquisition of PPE during 2020 was R (Write the full rand value, including zeroes but not including the "R". Do not use any signs or symbols to indicate that the outflow is a negative figure.) e) Ignore VAT A company offers its customers a six-month warranty, in terms of which they may return defective products for repair or replacement within six months of the purchase date. On 30 November 2020, the company's year-end, it expects that over the next six months it will spend an average of R234 per unit to repair goods returned under warranty, and an average of R632 per unit to replace goods returned under warranty. It expects that over the next six months, 4 000 units of returned goods will need to be repaired, and 1 000 units of returned goods will need to be replaced. It expects that half of the goods that will be returned in the next six months will have been sold in the 2020 financial year. On 30 November 2020, the company's Warranties Provision should be measured at an amount of R (Write the full rand value, including any zeroes but not including the "R")