Study & Master

Support Pack 2 | Grade 10

CAPS

Accounting
Memorandum: November exemplar
examination (Paper 1)

This revision pack for Accounting Grade 10 provides support for learners
revising the most important concepts and principles covered in the CAPS
curriculum, by providing practice exams. This pack offers a marking
memorandum for the November exemplar examination (Paper 1).
You have permission to print or photocopy this document, and to
distribute it electronically via email or WhatsApp.
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Grade 10 ACCOUNTING Time: 2 hours
PAPER 1
November MEMORANDUM Marks: 120

QUESTION 1 [18 marks]

BOOKKEEPING CONCEPTS, SALARIES, GAAP

1.1 BOOKKEEPING CONCEPTS

1.1 Choose a word or phrase from the list of concepts.
1.1.1 Credit note 

1.1.2 Debit note 

1.1.3 Cash Payments 

1.1.4 Debtors Allowance 

1.1.5 General 

1.2 SALARIES
1.2.1 Calculate her net salary.
12 400 – (12 400 x 18%) – (12 400 x 1%) – 900
= 12 400  – 2 232  – 124  – 900 
= R9 144 

1.2.2 How much will it cost the company per month to employ Athrah
(cost-to-company)?
12 400 + 124 + (900 x 0,5) = 12 400  + 124  + 450 
= R12 974 

1.3 GAAP PRINCIPLES

1.3 Match Column B with the description in Column A.
1.3.1 D 

1.3.2 C 

1.3.3 E 

1.3.4 B 

1
QUESTION 2 (44 marks)
STATEMENT OF COMPREHENSIVE INCOME (INCOME
STATEMENT)

LJ FOOTGEAR
Statement of Comprehensive Income (Income Statement) for the year ended
28 February 2018
Sales ( 1827 350 – 5210 - 1 602) 1 820 538
Cost of sales (1 012 300 -890) (1 011 410)
Gross profit  () 809 128 (6)
Other income  () 154 080
Current income (136 870 – 300) 136 570
Rent income (16 850 – 1 450) 15 400
Discount received  2 110
Gross operating income 963 208 (7)
Operating expenses  () (509 787 )
Wages and salaries  360 240
UIF contribution  3 602
Bad debts (12 500 + 2 160) 14 660
Stationery (9 620 – 730) 8 890
Advertisements (21 580 – 9 380) 12 200
Water and electricity (12 276 + 1 027) 13 303
Telephone (16 954 + 1 473) 18 427
Sundry expenses  48 700
Trading stock deficit [(60 390 + 890) – 58 740] () 2 540
Depreciation (21 675 + 4 820 + 730) 27 225

Operating profit  () 453 421 (27)

Interest income (1 575 + 875+621) 3 071
Net profit for the year 456 492 (4)

44

2
 QUESTION 3 (44 marks)
STATEMENT OF FINANCIAL POSITION (BALANCE SHEET)

3.1.1 Fixed/Tangible assets

Land and building Vehicles Equipment Total
Carrying value at the beginning 2 770 000  92 600 () 41 320 () 2 903 920
of the year
Cost price 2 770 000  170 000  63 500  3 003 500

Accumulated depreciation (77 400)  (22 180)  (99 580)

Movements

Additions at cost price 230 000  120 000  350 000

Depreciation (35 000)  (7 620)  (42 620)

Carrying value at the end of the 3 000 000 177 600 33 700 3 211 300
year
Cost price 3 000 000 290 000 63 500 3 353 500

Accumulated depreciation (112 400) (29 800) (142 200)

12

3.1.2 Trade and other receivables

Trade debtors  52 310

Accrued income  2 290

Prepaid expenses  2 700

57 300

3.1.3 Owner’s equity

Balance beginning of the year  1 853 290

Additional capital  600 000

Net profit  632 710

3 086 000

Drawings  (380 000)

Balance end of the year

140 550

3
3.1.4 Trade and other payables
Trade creditors  72 600

Accrued expenses  3 080

Income received in advance  4 000

79 680

3.2 ASHLEIGH FASHIONS

STATEMENT OF FINANCIAL POSITION (BALANCE SHEET) ON 30 JUNE 2018
ASSETS Note

Non-current assets ()3 236 300

Fixed/Tangible assets 3.1.1 ()3 211 300

Fixed deposit: Invest Bank (35 000-10 000) 25 000

Current assets ()359 500

Inventories (287 000 + 1 600) 288 600

Trade and other receivables  ()57 300

Cash and cash equivalents (600 + 3 000 + 10 000) 13 600

TOTAL ASSETS (12) ()3 595 800

EQUITY AND LIABILITIES

Owner’s equity 3.1.3 2 706 000

Non-current liabilities ()650 000

Loan: STR Bank (780 000- 130 000) 650 000

Current liabilities ()239 800

Trade and other payables ()79 680

Bank overdraft  30 120

Short-term loan  130 000

TOTAL EQUITY AND LIABILITIES (10) ()3 595 800

22

4
QUESTION 4 (30 marks)
ANALYSIS AND INTERPRETATION OF FINANCIAL STATE-
MENTS

4.1.1 The mark-up percentage on cost price achieved in 2018.

1 210 320 
2 420 640 
× 100
= 50 % 

4.1.2 The owner made a decision to change profit mark-up from 2017 to 2018.
What was that decision and was it a good decision? Quote ONE figure to
motivate your answer.
Profit mark-up decreased from 80% to 50%

Yes, it was a good decision

Sales increased from R2 420 640 to R3 630 960 because goods are sold at a lower
price
Any acceptable answer

General 

4.2.1 Current ratio for 2018

191 200 : 91 820
= 2,1 : 1

4.2.2 Acid-test ratio for 2018

(191 200 – 98 000) : 91 820 
= 1,02:1

4.2.3 Comment on the liquidity of the business.

Current ratio improved from 1,6:1 in 2017 to 2,1:1 in 2018 

Acid-test ratio improved from 0,4:1 to 1,02:1 in 2018

The business will be able to settle short-term obligations 

The business sold off excess stock which improved the liquidity

Any acceptable answer

5
 4.3.1 Percentage operating expenses on sales for 2018.
819 350 
3 630 960 
× 100
= 22,6 % 

4.3.2 Did the business’ control over expenses strengthen or weaken during 2018?
Quote ONE financial indicator.
The percentage operating expenses on sales decreased from 33,3% in 2017 to 22,5% in
2018 

The business therefore has better control over expenses 

4.3.3 Name ONE reason the change in 4.3.2 can be attributed to.
The expenses of the business stayed more or less the same, but the sales increased 

QUESTION 5 (14 marks)

ACCOUNTING EQUATION

No. Assets Owner’s Equity Liabilities

Effect Reason Effect Reason Effect Reason
5.1 – 6384 Bank decrease  + 266 Discount received – – 6650 Creditors decrease 
income

5.2 + 5200 Cash received  + 200 Interest on fixed deposit

– income
– 5 000 Fixed deposit decrease

5.3 – 1 577 Bank decrease  + 83 Discount allowed –

expense decreased 
+ 1 660 Debtors increase 

14