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BAC611C- BUSINESS ACCOUNTING 1B- 2ND OPP- NOV 2023 |
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nAmlBIA unlVERSITY
OF SCIEnCE Ano TECHnOLOGY
FACULTY OF COMMERCE, HUMAN SCIENCESAND EDUCATION
CENTERFOR ENTERPRISEDEVELOPMENT(CED)
QUALIFICATION: DIPLOMA IN BUSINESSPROCESSMANAGEMENT
QUALIFICATIONCODE:06DBPM LEVEL:6
COURSECODE: BAC611C
COURSENAME: BUSINESSACCOUNTING 2A
SESSION:JANUARY2024
PAPER:PAPER2
DURATION: 3 HOURS
MARKS: 100
SECOND OPPORTUNITY EXAMINATION QUESTION PAPER
EXAMINER
Lameck Odada
MODERATOR Gerhardt Sheehama
INSTRUCTIONS
1. This question paper is made up of four (4) questions.
2. Answer ALLthe questions in blue or black ink only. NO pencil
3. Start each question on a new page in your answer booklet and show all workings.
4. Work with four (4) decimal places in all your calculations and only round off only final
answers to two (2) decimal places unless otherwise stated.
5. Questions relating to this examination may be raised in the initial 30 minutes after the
start of the paper. Thereafter, candidates must use their initiative to deal with any
perceived error or ambiguities & any assumption made by the candidate should be
clearly stated.
PERMISSIBLEMATERIALS
Silent, non-programmable calculators
THIS QUESTION PAPERCONSISTSOF 6 PAGES(excluding this front page)
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QUESTION 1
[20 MARKS]
For questions, 1.1-1.10, write the answer only (the correct letter chosen) in your answer sheet/answer
book and not on the question paper.
1.1 The journal entry for credit sales of goods to accounts receivable is:
a) sales Dr. & Accounts Receivable Cr.
b) accounts Receivable Dr. & Sales Cr.
c) cash Dr. & Sales Cr.
d) sales Dr. & Accounts Payable Cr.
1.2 The cash discount (also known as purchase discount or sale discount) is given to customers for:
a) early payments
b) the bulk purchases
c) frequent purchases
d) good business relations
1.3 The accounts receivable that cannot be collected because of their bankruptcy or another reason
are termed:
a) collectible accounts
b) bad customers
c) doubtful accounts
d) uncollectible accounts
1.4 Accounts receivables are reported in the statement of financial position:
a) at face value
b) at gross value
c) at net realizable value
d) at net credit sales value
1.5 A soundly developed conceptual framework of concepts and objectives should
a) increase financial statement users' understanding of and confidence in financial
reporting.
b) enhance comparability among companies' financial statements.
c) allow new and emerging practical problems to be more quickly solved.
d) all the above
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1.6 The underlying theme of the conceptual framework is
a) decision usefulness.
b) understandability.
c) reliability.
d) comparability.
1.7 Which of the following is not among the ingredients of the fundamental quality of faithful
representation?
a) freedom from error.
b) neutrality.
c) materiality.
d) completeness.
1.8 Enhancing qualities of accounting information include:
a) comparability and verifiability.
b) relevance and consistency.
c) comparability and materiality.
d) relevance and faithful representation.
1.9 Enhancing qualities of accounting information include all the following except:
a) comparability.
b) understandability.
c) neutrality.
d) timeliness.
1.10 An ingredient of relevance is:
a) freedom from error.
b) neutrality.
c) comparability.
d) materiality.
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QUESTION 2
[32 MARKS]
Julitha and Ashlynne are in partnership. They share profits and losses in the ratio of 60:40 respectively.
The following is their trial balance as at 30 September 2023.
Buildings (cost N$105 000)
Fixtures at cost
Provision for depreciation:
Accounts receivables
Accounts payables
Cash at bank
Inventory at 30 September 2022
Sales
Purchases
Carriage outwards
Discounts allowed
Loan interest:
Office expenses
Salaries and wages
Bad debts
Allowance for doubtful debts
Loan from P Prince
Capitals:
Current accounts:
Drawings:
Fixtures
P Prince
Julitha
Ashlynne
Julitha
Ashlynne
Julitha
Ashlynne
Dr (N$)
80,000
4,100
30,700
3,065
31,370
105,000
1,705
310
1,950
2,380
28,905
816
15,900
14,100
320,301
Cr (N$)
2,100
13,295
181,556
700
32,500
50,000
37,500
2,050
600
320,301
Additional information
• Inventory, 30 September 2023, N$37 105
• Expensesto be accrued: Office expenses N$108; wages N$360
• Depreciation fixtures 15% on a reducing balance basis; buildings N$2 500
• Reduce provision of doubtful debts to N$ 625
• Partnership salary: N$15 000 to Julitha. Not yet entered
• Interest on drawings: Frame N$450; French N$300
• Interest on capital account balances at 5%
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REQUIREMENT:
a) Prepare the partnership statement of profit or loss for the year ended 30 September
2023
b) Prepare the partnership profit and loss appropriation account for the year ending
30 September 2023
MARKS
20
12
QUESTION 3
[20 MARKS]
Diesel-Electric (DE) is one of the biggest suppliers of automotive products in Namibia. They offer a vast
range of services such as automotive air conditioning, auto workshop, battery testing & recharging, Bosch
service training, automotive computer diagnostics, and much more. With branches in Windhoek,
Otjiwarongo, Tsumeb, Oshakati, Swakopmund, and Walvis Bay they provide services in most parts of
Namibia. Below is the abridged statement of financial position of DEfor the year ended 28 February 2023.
Non-current assets
Buildings
Fixtures
Motor vehicles
Current assets
Inventory
Accounts receivables
Bank
Total assets
Equity:
Capital
Additional capital
Profit for the year
Less: Drawings
Liabilities
Accounts payables
Bank Overdraft
Loans
Total equity and liabilities
2023
500,000
200,000
547,000
841,000
597,000
15,000
2,700,000
1,610,000
250,000
790,000
-780,000
1,870,000
204,000
126,000
500,000
2,700,000
2022
500,000
180,000
289,000
300,000
486,000
345,000
2,100,000
1,550,000
680,000
-620,000
1,610,000
290,000
-
200,000
2,100,000
• Fixtures bought in 2023 cost N$40 000 and a motor vehicle was also bought for exactly N$400
000.
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REQUIREMENT
MARKS
a) Draw up the statement of cash flows of Diesel Electric for the year ended 28
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February 2023 using the indirect method.
b) Highlight any three (3) uses of a statement of cash flows
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c) Explain any two (2) limitations of a cash flow statement
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QUESTION 4
[28 MARKS]
Established on 29 October 1920, Namibia Breweries Limited (NBL) is one of the leading beverage
manufacturing companies in Namibia and, indeed, in Southern Africa. Today, NBL leads the domestic beer
market and has a significant share of the premium beer category in South Africa. You have been provided
with the financial statements of NBL for the year ended 30 June 2023.
Statement of financial position as at 30 June 2023
ASSETS
Non-current assets- Net plant and equipment
Current assets
Inventory
Accounts receivables
Cash
Total current assets
TOTAL ASSETS
EQUITY AND LIABILITIES
Share capital
Retained profit
Total equity
Non-current liabilities
Long-term borrowings
Current liabilities
Trade and other accounts payables
Short-term borrowings
Total current liabilities
TOTAL EQUITY AND LIABILITIES
2023
N$'000
19167
4 906
2 510
906
8 322
27 489
10 000
10 209
20 209
4960
1480
840
2 320
27 489
2022
N$'000
15164
4 608
2 405
815
7 828
22 992
10 000
6 367
16 367
4 817
1088
720
1808
22 992
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Statement of profit or loss for the year ended 30 June 2023
Revenue
Cost of sales
Depreciation
Profit Before Interest and Tax
Interest paid
Net profit before tax
Taxes
Net profit after tax
Dividends
Additions to retained profits
2023
N$'000
33 500
18 970
1980
12 550
486
12 064
4 222
7 842
4000
3 842
2022
N$'000
29150
16 290
1650
11210
463
10 747
3 761
6 986
4000
2 986
REQUIREMENT: assume a 365-day year, compute the following ratios for 2022 and 2023 and MARKS
also comment on whether the ratio has improved or deteriorated.
a) Current ratio
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b) Quick/ Acid test ratio
4
c) Accounts receivables/debtors' collection period
4
d) Accounts payables/creditors settlement period
4
e) Gross profit margin
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f) Return on Equity (ROE)
4
g) Explain any two (2) limitation of ratio analysis
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END OF EXAMINATION QUESTION PAPER
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