FAC1601 ASSESSMENT 3 – SEMESTER 2 OF
2024
QUESTION 1
GreenFields Fertilizer Ltd is a company incorporated in 2023, specialising in the production and
sale of high-performance fertilizers for maize and other crops. The company has grown steadily
over the years due to its innovative approach in developing sustainable fertilizers tailored to
improve crop yield and soil health. Operating out of a state-of-the-art production facility in
Broederstroom, North West Province, GreenFields Fertilizer Ltd serves farmers and agricultural
enterprises across South Africa. The company prides itself on strong research and development
capabilities, ensuring its products are aligned with the latest advancements in agricultural
science.
The company's authorised share capital includes 1,300,000 NPV ordinary shares and 650,000
10% preference shares of R5.9 each. With a financial year-end on 30 June, GreenFields Fertilizer
Ltd has consistently demonstrated financial prudence, leading to robust shareholder returns.
The company financial year end is 28 February.
Below are the share transactions recorded for GreenFields Fertilizer Ltd since its incorporation:
• On 1 March 2023, 99,000 ordinary shares were issued to subscribers at R6.5 per share.
• On 5 April 2023, 184,000 ordinary shares and 190,000 10% preference shares were
issued to the public at R7.9 each and R6.3 each, respectively.
• On 15 January 2024, the share capital for ordinary shares increased by R1,947,500. These
shares were issued at R9.5 each.
• On 1 June 2024, 74,000 10% preference shares were issued at R11.8 each.
• On 31 May 2024, the directors approved a capitalisation issue of 2 shares for every 5
ordinary shares held at R6.9 per share.
• On 31 August 2024, the board of GreenFields Fertilizer Ltd declared an interim ordinary
dividend of R1.5 per share payable during November 2024. The company met the
liquidity and solvency requirements, and on 1 December 2024, payment was made to the
shareholders in respect of the dividends.
• Assume that the total number of shares issued before the capitalisation and the
capitalisation shares issued is 550 000 and 330 000 respectively. Calculate the correct
amount of ordinary share dividend by GreenFields Fertilizer Ltd on 31 August 2024?
,Instructions:
1. Round off all your answers to the nearest rand (eg: 50.56 = 51)
2. Don’t use any special characters (&) and don’t use bold in your answer. It will be
marked incorrect.
3. Do not use any abbreviations.
4. Please remember the brackets around the amounts must be indicated by a
negative amount [eg: (50) will be -50].
1320000
Answer:
[(550 000 + 330 000) * 1.50] = R1 320 000
, QUESTION 2
GreenFields Fertilizer Ltd is a company specialising in the production and distribution of high-
quality fertilizers for maize and other crops. The company operates a large manufacturing plant
located in Broederstroom, North West Province, where it produces a variety of fertilizers tailored
to optimise soil nutrients and increase crop yields. GreenFields Fertilizer Ltd has gained a
significant presence in the agricultural sector and serves clients across Southern Africa.
The company's financial year-end is 28 February, and it has consistently maintained strong
financial performance since its incorporation.
GREENFIELDS FERTILIZER LTD
EXTRACT OF BALANCES AS AT 28 FEBRUARY 2024:
R
Investments 376,925
Land and buildings at revaluation (1 March 2023) 1,119,400
Equipment at cost 658,300
Accumulated depreciation: Equipment 87,900
Revaluation surplus (1 March 2023) 120,200
Inventory (1 March 2023) 46,200
Bank 137,300
Trade receivables control 283,500
Petty cash 8,000
Share capital: Ordinary shares (1 March 2023) 755,300
Retained earnings (1 March 2023) 280,700
Loan: Broederstroom Bank 125,500
SARS (income tax) (Dr) 35,300
Sales 3,205,100
Allowance for settlement discount granted 7,400
Carriage on purchases 22,600
Trade payables control 265,900
Income received in advance 8,200
Allowance for credit losses 7,200
Settlement discount granted 5,700
Auditor's remuneration 141,800
Carriage on sales 28,300
Settlement discount received 2,400
2024
QUESTION 1
GreenFields Fertilizer Ltd is a company incorporated in 2023, specialising in the production and
sale of high-performance fertilizers for maize and other crops. The company has grown steadily
over the years due to its innovative approach in developing sustainable fertilizers tailored to
improve crop yield and soil health. Operating out of a state-of-the-art production facility in
Broederstroom, North West Province, GreenFields Fertilizer Ltd serves farmers and agricultural
enterprises across South Africa. The company prides itself on strong research and development
capabilities, ensuring its products are aligned with the latest advancements in agricultural
science.
The company's authorised share capital includes 1,300,000 NPV ordinary shares and 650,000
10% preference shares of R5.9 each. With a financial year-end on 30 June, GreenFields Fertilizer
Ltd has consistently demonstrated financial prudence, leading to robust shareholder returns.
The company financial year end is 28 February.
Below are the share transactions recorded for GreenFields Fertilizer Ltd since its incorporation:
• On 1 March 2023, 99,000 ordinary shares were issued to subscribers at R6.5 per share.
• On 5 April 2023, 184,000 ordinary shares and 190,000 10% preference shares were
issued to the public at R7.9 each and R6.3 each, respectively.
• On 15 January 2024, the share capital for ordinary shares increased by R1,947,500. These
shares were issued at R9.5 each.
• On 1 June 2024, 74,000 10% preference shares were issued at R11.8 each.
• On 31 May 2024, the directors approved a capitalisation issue of 2 shares for every 5
ordinary shares held at R6.9 per share.
• On 31 August 2024, the board of GreenFields Fertilizer Ltd declared an interim ordinary
dividend of R1.5 per share payable during November 2024. The company met the
liquidity and solvency requirements, and on 1 December 2024, payment was made to the
shareholders in respect of the dividends.
• Assume that the total number of shares issued before the capitalisation and the
capitalisation shares issued is 550 000 and 330 000 respectively. Calculate the correct
amount of ordinary share dividend by GreenFields Fertilizer Ltd on 31 August 2024?
,Instructions:
1. Round off all your answers to the nearest rand (eg: 50.56 = 51)
2. Don’t use any special characters (&) and don’t use bold in your answer. It will be
marked incorrect.
3. Do not use any abbreviations.
4. Please remember the brackets around the amounts must be indicated by a
negative amount [eg: (50) will be -50].
1320000
Answer:
[(550 000 + 330 000) * 1.50] = R1 320 000
, QUESTION 2
GreenFields Fertilizer Ltd is a company specialising in the production and distribution of high-
quality fertilizers for maize and other crops. The company operates a large manufacturing plant
located in Broederstroom, North West Province, where it produces a variety of fertilizers tailored
to optimise soil nutrients and increase crop yields. GreenFields Fertilizer Ltd has gained a
significant presence in the agricultural sector and serves clients across Southern Africa.
The company's financial year-end is 28 February, and it has consistently maintained strong
financial performance since its incorporation.
GREENFIELDS FERTILIZER LTD
EXTRACT OF BALANCES AS AT 28 FEBRUARY 2024:
R
Investments 376,925
Land and buildings at revaluation (1 March 2023) 1,119,400
Equipment at cost 658,300
Accumulated depreciation: Equipment 87,900
Revaluation surplus (1 March 2023) 120,200
Inventory (1 March 2023) 46,200
Bank 137,300
Trade receivables control 283,500
Petty cash 8,000
Share capital: Ordinary shares (1 March 2023) 755,300
Retained earnings (1 March 2023) 280,700
Loan: Broederstroom Bank 125,500
SARS (income tax) (Dr) 35,300
Sales 3,205,100
Allowance for settlement discount granted 7,400
Carriage on purchases 22,600
Trade payables control 265,900
Income received in advance 8,200
Allowance for credit losses 7,200
Settlement discount granted 5,700
Auditor's remuneration 141,800
Carriage on sales 28,300
Settlement discount received 2,400
