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ACCOUNTING GRADE 11
CASE STUDY: MARKING GUIDELINES

MARKS
TOPIC: BUDGETS
Total Learner
QUESTION 1
Budget Concepts Allocate marks as per 5
1.1
marking guideline
Allocate marks as per 9
1.2 Debtors’ Collection Schedule
marking guideline
Allocate marks as per
1.3 Bad debts amount 2
marking guideline
Allocate marks as per 52
1.4 Cash Budget
marking guideline
Internal control and problem Allocate marks as per 4
1.5
solving marking guideline
QUESTION 2
Allocate marks as per
2.1 Creditors’ Payment Schedule 11
marking guideline

Allocate marks as per

2.2.1 -2.2.2 Problem solving 17
marking guideline
Total Marks 100

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QUESTION 1: CASH BUDGET

1.1 Identify FIVE items that are not included in a cash budget from Information D.
One mark allocated to each item    
 Depreciation
 Discount received
 Trading stock deficit
 Bad Debts
 Profit on sale of asset
 Accrued expenses
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1.2 DEBTORS COLLECTION SCHEDULE FOR THE PERIOD 1 APRIL 2020 TO 30

JUNE 2020
Credit sales April May June
February 72 000 14 400 9
March 64 000 22 400 12 800
April 60 000 22 800 21 000 12 000
May 88 000 33 440 30 800
June 120 000 45 600
Cash from  For all the 59 600 67 200 88 400
debtors totals

1.3 Calculate the amount of bad debts in June 2020

2
64 000 x 5/100 = 3 200

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1. CASH BUDGET FOR THE PERIOD 1 APRIL 2020 TO 30 JUNE 2020

4
CASH RECEIPTS April May June
Cash sales 90 000 132 000 180 000
Cash from debtors  59 600  67 200  88 400
Rent income 18 000 19 800 19 800
Sale of printer (8 000 – 2 000) 6 000
Loan ( 5 000 x 24) 120 000
Interest on Fixed Deposit 750  675  675
Fixed Deposit  90 000
Total receipts # 288 350 225 675 378 875
CASH PAYMENTS
Cash purchases 55 000 70 000 80 000
Payment to creditors 30 000 32 500 32 500
Sundry expenses 7 000 7 000 7 500
Rates and taxes 8 000 4 000 4 000
Advertising 3 000 4 400 6 000

Insurance 4 600 4 600 4 140

Deposit for a new printer 9 000
Repayment of instalments –Printer 3 000
Loan repayment 5 000 5 000
Interest on loan Check the loan above 1 200 1 150
Drawings 8 000 8 000 8 000
Salaries 19 500 24 000 21 060
Total payments # 135 100 169 700 172 350
Cash surplus / deficit  153 250 55 975 206 525
Bank: opening balance 99 000 252 250 308 225
Bank: closing balance 252 250 308 225 514 750
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# one mark for all the three totals that include pre-printed figures

1.5 The business is concerned that some of the debtors are paying slow. Suggest
TWO ways to solve this problem.
Any two valid suggestions  
 Charge interest on overdue accounts, to encourage debtors to pay faster.
 Grant discount for payments made within 30 days.
 Handover the debtors who are not honouring their accounts to collection 4
agencies. l

One mark for partially correct response

Total Marks

72

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2020 Grade 11 Case Study: Marking Guidelines

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QUESTION 2: BUDGETING AND PROBLEM SOLVING

2. CREDITORS PAYMENT SCHEDULE FOR 1 JULY 2020 TO 30 SEPTEMBER 2020

1
Cost of Credit July August September
sales Purchases
July 270 000 135 000 51 300 40 500 40 500
August 300 000 150 000 57 000 45 000
September 290 000 145 000 55 100
 For all the 51 300 97 500 140 600
totals

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2.2 BUDGETS : PROBLEM SOLVING

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2.2. Refer to INFORMATION A and comment on the variance (difference) for each
1 item. Provide ONE point of advice that can be implemented by the business in
each case. Limit your responses to THREE items.
Expense item Comment  Advice   
Sales Actual less than budgeted  Introduce credit sales to
properly screened
customers.
 Consider reducing the
mark-up if it’s too high
 Provide delivery services
Telephone Actual exceed the budgeted  Investigate the reason for
high cost and introduce
codes and limits.
Advertising Spent less than budget  Use allocated funds to
market the goods.
Rent Income Received less than expected  Check if there are lease
agreements that have
expired.
 Consider adjusting the
rent charged to tenants.
 Check if the property is in
good condition –and
consider reasonable
costs of renovating.
Allocate one mark for partially
correct answer 9

2.2 The sales assistants are dissatisfied with their wage increase. Give TWO
2 reasons for dissatisfaction.
Any TWO valid points  
 Inflationary increase does not improve their standard of living
 Manager gets a bigger percentage increase

Explain in TWO points how the business will be affected if their

complaints are not responded two.
Any TWO valid points  
 Productivity may reduce and sales figures will drop.
 The employees might take their grievances/complaint to the trade unions 4
 The business ca loose competent employees.

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Total Marks

28

2020 Grade 11 Case Study: Marking Guidelines