PRAC01W Prepare A Statement Of Tshisanyama in Sandton Assignment

Assignment Task

Question 1

The Ridge is a Tshisanyama in Sandton. The following information relates to the financial year ended 30 April 2024.

Pre-adjustment trial balance as of 30 April 2024:

Additional information:

1. R8 000 was paid and recorded at each month-end towards the water and electricity account, except for April 2023 month-end.

2. Car insurance of R3 200 per month was acquired on 30 June 2023 for the period 1 July 2023 to 31 June 2024. An upfront payment of R44 800 was paid and recorded as an expense on 30 June 2023.

3. Depreciation must still be recorded: - depreciation on furniture and equipment at 5% per annum according to the straight-line method, and - depreciation on the vehicle at 15% per annum according to the diminishing balance method.

4. The long-term loan was obtained from Global Bank on 1 May 2022 at 8,75% interest per annum. Interest is capitalised to the loan. The interest expense has not yet been recorded.

5. The monthly rent expense is R10 000. Only the rent paid has been accounted for.

Required:

Prepare all the general journal entries at 30 April 2024 with narrations.

Show your calculations.

Question 2 

Sun Derk Inn financial records reflected the following information on 30 September 2024.

1. Balances:

Debit Bank balance of bank account in general ledger at 30 September 2024 R939 74

Credit Balance per bank statement at 30 September 2024 R273 394 2.

2. The cash journals reflected the following at 30 September 2024:

Cash Receipts Journal R200 600

Cash Payments Journal R846 000

3. A comparison of the bank statement of 30 September 2024 and the cash journals for September 2024 reflected the following:

3.1. The following cheques were not yet presented at the bank for payment:

• Cheque 1001 issued on account to Kwada Farm for R5 000.
• Cheque 1002 issued to Loki Construction for R11 345.
• Cheques 1003 Issued to TeleMobi for R5 600 for wifi.

3.2. The bank statement reflected the following entries not yet recorded in the cash payments journal:

• Bank charges of R1 000
• Cash withdrawal charges for petty cash of R850
• A debit order of R33 000 for monthly insurance premium
• A debit order of R3 500 licencing.

3.3. Cheque no. 1101 issued in favour of a supplier for R5 000 was lost and must be cancelled.

3.4. Mr Gibleey deposited R14 699 directly into the bank account to settle his credit. This was not recorded in the books of Sun Derk Inn.

3.5. A deposit of R2 300 was received on the 4th of September from the spa department recorded in the cash receipts journal does not reflect on the bank statement.

3.6. A cheque of R1 100 was mistakenly credited by the bank to the account of Sun Derk Inn.

Required

(a) Prepare the bank account in the general ledger for September 2024, close off and balance.

(b) Prepare a bank reconciliation statement as at 30 September 2024.

Question 3

Moishe Tech sells software. The company uses a periodic inventory recording system. During the financial year ended 30 September 2024, the company had made the following transactions.

Required

(a) Assuming that the company uses the First-In-First-Out cost allocation method, calculate the closing balance of inventory as at 30 September 2024.

(b) Assuming that the company uses the Weighted Average cost allocation method, calculate the closing balance of inventory as at 30 September 2024.

(c) Prepare the adjusting journal entries required in the general journal of Moishe Tech on 30 September 2024 in respect of inventory. For this question, C, assume that Moishe Tech uses the First-In-First-Out cost allocation method.

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