1
Question 1 (15 marks) (18 Minutes)
(a) Interest income (PL: Inc) - Thuto Ltd 17 188
Interest expense (PL: Exp) - Lethabo Ltd 17 188
(150 000 x 12.5% x 11/12)
(b) Other income (PL: Inc) - Thuto Ltd (40%) 8 000
Non-controlling interest (SCE) - Lethabo Ltd (60%) 12 000
Preference dividends paid (SCE) - Lethabo Ltd 20 000
(100 000 x 10% x 2)
(c) Retained earnings (BOY) (SCE: Inc) - Lethabo Ltd 35 000
Machinery (FP: A) - Thuto Ltd 35 000
(100 000 - 65 000)
Accumulated depreciation: Machinery (FP: A) - Thuto Ltd 8 750
Depreciation (PL: Exp) - Lethabo Ltd 8 750
Question 2 (51 marks) (61 Minutes)
Ciya Ltd Group
Consolidated statement of profit or loss and other comprehensive income for the year ended
31 March 2016.
Revenue (1 291 250 + 503 750 - 187 500 (I3)) 1 607 500
Cost of sales (774 750 + 278 750 - 187 500 (I3) - 15 000 (I5) + 10 000 (I6)) (861 000)
Gross profit 746 500
Other income (28 125 - 12 000 (P8) - 10 000 (P9)) 6 125
Interest income (10 000 + 6 625 - 5 250 (I2)) 11 375
Other expenses (191 250 + 52 500 - 5 250 (adj 8) - 1 600 (I9) - 4 000 (I10) + 467 (I1)) (233 367)
Finance costs (25 000 + 19 250 + 5 250 (adj 8) - 5 250 (I2)) (44 252)
Profit before tax 486 381
Income tax expense (94 745 + 44 765) (139 510)
Profit for the year 346 871
Other comprehensive income for the year 0
Total comprehensive income for the year 346 871
Profit for the year attributable to:
Owners of the parent 316 823
Non-controlling interest (9 000 (P6) + 21 049 (P7)) 30 049
346 871
Total comprehensive income for the year attributable to:
Owners of the parent 316 823
Non-controlling interest 30 049
346 871
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Ciya Ltd Group
Extract: Consolidated statement of changes in equity for the year ended 31
March 2016.
Non-
Retained controlling
earnings interest
Balances: 1/4/2015 358 140 1 167 058 2
Total comprehensive income for the year
Profit for the year 316 823 30 049
Other comprehensive income for the year
Dividends
Preference 0 (18 000)
Ordinary (45 000) (2 500)
Balances: 31/3/2016 629 963 176 607
1. RE (BOY): 280 908 + 167 890 - 15 000 (I4) - 8 000 (I7) + 400 (I8) - 37 500 (P2)
- 9 000 (P4) - 21 558 (P5) = 358 140
2. NCI (BOY): (75 000 (P1) + 57 500 (P2) + 4 000 (P3) + 9 000 (P4) + 21 558 (P5) = 167 058
Ciya Ltd Group
Extract: Consolidated statement of financial position as at 31 March 2016.
Assets
Non-current assets 1 115 908
Property, plant and equipment (900 000 + 203 375 + 275 000 + 225 000
- 112 500 - 82 500 - 8 000 (I7) + 400 (I8) + 1 600 (I9) + 4 000 (I10) - 467 (I11)) 1 100 908
Investments (237 500 + 57 500 + 43 750 - 43 750 (I1) - 57 500 (P1) - 237 500 (P2)) 0
Goodwill (7 500 (P1) + 7 500 (P2)) 15 000
Calculations:
I1 12% Debentures (FP: L) 43 750
Investment: Debentures (FP: A) 43 750
Adj 8 Interest on debentures (PL: Exp) 5 250
Other expenses (PL: Exp) 5 250
I2 Interest income (PL: Inc) (43 750 x 12%) 5 250
Interest on debentures (PL: Exp) 5 250
I3 Sales (PL: Inc) 187 500
Cost of sales (PL: Exp) 187 500
I4 Retained earnings (BOY) (SCE) 15 000
Inventory (FP: A) (75 000 x 25/125) 15 000
I5 Inventory (FP: A) 15 000
Cost of sales (PL: Exp) 15 000
I6 Cost of sales (PL: Exp) 10 000
Inventory (FP: A) (50 000 x 25/125) 10 000
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I7 Retained earnings (BOY) (SCE) 8 000
Machinery (FP: A) (33 000 - 25 000) 8 000
I8 Accum Depr: Mach (FP: A) (8 000 x 20% x 3/12) 400
Retained earnings (BOY) (SCE) 400
I9 Accum Depr: Mach (FP: A) 1 600
Depreciation (PL: Exp) (8 000 x 20%) 1 600
I10 Machinery (FP: A) 4 000
Loss on sale of asset (PL: Exp) 4 000
I11 Depreciation (PL: Exp) (4 000 x 20% x 7/12) 467
Accum Depr: Mach (FP: A) 467
P1 Share Cap: Pref Sh (SCE) 125 000
Retained earnings (SCE) 0
Goodwill (FP: A) 7 500
Investment: Pref shares (FP: A) 57 500
NCI SCE) (60% x 125 000) 75 000
P2 Share Cap: Ord shares (SCE) 250 000
Retained earnings (SCE) (37 500 - 0) 37 500
Goodwill (FP: A) 7 500
Investment: Ord shares (FP: A) 237 500
NCI (SCE) (20% x 287 500) 57 500
P3 Reval surplus (BOY) (SCE) 4 000
NCI (BOY) (SCE) (20% x 20 000) 4 000
P4 Retained earnings (BOY) (SCE) 9 000
NCI (BOY) (SCE) (125 000 x 12% x 60%) 9 000
P5 Retained earnings BOY) (SCE) 21 558
NCI (BOY) (SCE) 21 558
(167 890 - 37 500 - 15 000 - 8 000 + 400 = 107 790 x 20%)
P6 NCI (PL) (125 000 x 12% x 60%) 9 000
NCI (SCE) 9 000
P7 NCI (PL) 21 049
NCI (SCE) 21 049
(115 110 - 15 000 + 4 000 + 1 600 - 467 = 105 243 x 20%)
P8 Other income (PL: Inc) (40%) 12 000
NCI (SCE) (60%) 18 000
Pref dividednds (SCE) (125 000 x 12% x 2) 30 000
P9 Other income (PL: Inc) (80%) 10 000
NCI (SCE) (20%) 2 500
Ord dividednds (SCE) 12 500
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Question 3 (29 marks) (35 Minutes)
Green Ltd
Statement of cash flows for the year ended 31 May 2016
Cash flows from operating activities
Cash received from customers (a) 5 108 490
Cash paid to suppliers and employees (b) (2 844 800)
Cash generated from operations 2 263 690
Interest received (295 000 - 250 000 - 15 00) 30 000
Interest paid (225 000 + 1 500 - 2 300) (224 200)
Dividends received 15 000
Dividends paid (371 875 - 5 000) (366 875)
Tax paid (534 240 + 20 000 - 53 000) (501 240)
Acquisition of investments held for trade (through profit or loss) (d) (217 000)
Net cash flows from operating activities 999 375
Cash flows from investing activities
Investment in non-current assets to expand
Additions to non-current assets (1 400 000 + 500 000) (1 900 000)
Investment in non-current assets to maintain capacity
Replacement of non-current assets (580 000)
Proceeds from the sale of non-current assets (given) 330 000
Net cash flows from investing activities (2 150 000)
Calculations:
Revenue 4 800 000
Other income (295 000 - 250 000 - 15 000 - 30 000) 0
(Profit: A = 330 000 - 80 000 = 250 000)
(Int = bal fig: 295 000 - 250 000 - 15 000 = 30 000)
Credit losses (3 000)
Trade and other receivables (open) 555 000
Trade and other receivables (clos) (243 510)
5 108 490
(b) Purchases (2 112 000 - 680 000 + 850 000) 2 282 000
Other expenses (850 000 - 248 000 - 3 000 - 17 000) 582 000
Trade and other payables (open) (560 000 - 1 500) 558 500
Trade and other payables (clos) (580 000 - 2 300) (577 700)
2 844 800
FAC2602 May/Jun 2017 Exam Suggested solution
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Question 1 (15 marks) (18 Minutes)
(a) Interest income (PL: Inc) - Thuto Ltd 17 188
Interest expense (PL: Exp) - Lethabo Ltd 17 188
(150 000 x 12.5% x 11/12)
(b) Other income (PL: Inc) - Thuto Ltd (40%) 8 000
Non-controlling interest (SCE) - Lethabo Ltd (60%) 12 000
Preference dividends paid (SCE) - Lethabo Ltd 20 000
(100 000 x 10% x 2)
(c) Retained earnings (BOY) (SCE: Inc) - Lethabo Ltd 35 000
Machinery (FP: A) - Thuto Ltd 35 000
(100 000 - 65 000)
Accumulated depreciation: Machinery (FP: A) - Thuto Ltd 8 750
Depreciation (PL: Exp) - Lethabo Ltd 8 750
Question 2 (51 marks) (61 Minutes)
Ciya Ltd Group
Consolidated statement of profit or loss and other comprehensive income for the year ended
31 March 2016.
Revenue (1 291 250 + 503 750 - 187 500 (I3)) 1 607 500
Cost of sales (774 750 + 278 750 - 187 500 (I3) - 15 000 (I5) + 10 000 (I6)) (861 000)
Gross profit 746 500
Other income (28 125 - 12 000 (P8) - 10 000 (P9)) 6 125
Interest income (10 000 + 6 625 - 5 250 (I2)) 11 375
Other expenses (191 250 + 52 500 - 5 250 (adj 8) - 1 600 (I9) - 4 000 (I10) + 467 (I1)) (233 367)
Finance costs (25 000 + 19 250 + 5 250 (adj 8) - 5 250 (I2)) (44 252)
Profit before tax 486 381
Income tax expense (94 745 + 44 765) (139 510)
Profit for the year 346 871
Other comprehensive income for the year 0
Total comprehensive income for the year 346 871
Profit for the year attributable to:
Owners of the parent 316 823
Non-controlling interest (9 000 (P6) + 21 049 (P7)) 30 049
346 871
Total comprehensive income for the year attributable to:
Owners of the parent 316 823
Non-controlling interest 30 049
346 871
FAC2602 May/Jun 2017 Exam Suggested solution
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, 2
Ciya Ltd Group
Extract: Consolidated statement of changes in equity for the year ended 31
March 2016.
Non-
Retained controlling
earnings interest
Balances: 1/4/2015 358 140 1 167 058 2
Total comprehensive income for the year
Profit for the year 316 823 30 049
Other comprehensive income for the year
Dividends
Preference 0 (18 000)
Ordinary (45 000) (2 500)
Balances: 31/3/2016 629 963 176 607
1. RE (BOY): 280 908 + 167 890 - 15 000 (I4) - 8 000 (I7) + 400 (I8) - 37 500 (P2)
- 9 000 (P4) - 21 558 (P5) = 358 140
2. NCI (BOY): (75 000 (P1) + 57 500 (P2) + 4 000 (P3) + 9 000 (P4) + 21 558 (P5) = 167 058
Ciya Ltd Group
Extract: Consolidated statement of financial position as at 31 March 2016.
Assets
Non-current assets 1 115 908
Property, plant and equipment (900 000 + 203 375 + 275 000 + 225 000
- 112 500 - 82 500 - 8 000 (I7) + 400 (I8) + 1 600 (I9) + 4 000 (I10) - 467 (I11)) 1 100 908
Investments (237 500 + 57 500 + 43 750 - 43 750 (I1) - 57 500 (P1) - 237 500 (P2)) 0
Goodwill (7 500 (P1) + 7 500 (P2)) 15 000
Calculations:
I1 12% Debentures (FP: L) 43 750
Investment: Debentures (FP: A) 43 750
Adj 8 Interest on debentures (PL: Exp) 5 250
Other expenses (PL: Exp) 5 250
I2 Interest income (PL: Inc) (43 750 x 12%) 5 250
Interest on debentures (PL: Exp) 5 250
I3 Sales (PL: Inc) 187 500
Cost of sales (PL: Exp) 187 500
I4 Retained earnings (BOY) (SCE) 15 000
Inventory (FP: A) (75 000 x 25/125) 15 000
I5 Inventory (FP: A) 15 000
Cost of sales (PL: Exp) 15 000
I6 Cost of sales (PL: Exp) 10 000
Inventory (FP: A) (50 000 x 25/125) 10 000
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I7 Retained earnings (BOY) (SCE) 8 000
Machinery (FP: A) (33 000 - 25 000) 8 000
I8 Accum Depr: Mach (FP: A) (8 000 x 20% x 3/12) 400
Retained earnings (BOY) (SCE) 400
I9 Accum Depr: Mach (FP: A) 1 600
Depreciation (PL: Exp) (8 000 x 20%) 1 600
I10 Machinery (FP: A) 4 000
Loss on sale of asset (PL: Exp) 4 000
I11 Depreciation (PL: Exp) (4 000 x 20% x 7/12) 467
Accum Depr: Mach (FP: A) 467
P1 Share Cap: Pref Sh (SCE) 125 000
Retained earnings (SCE) 0
Goodwill (FP: A) 7 500
Investment: Pref shares (FP: A) 57 500
NCI SCE) (60% x 125 000) 75 000
P2 Share Cap: Ord shares (SCE) 250 000
Retained earnings (SCE) (37 500 - 0) 37 500
Goodwill (FP: A) 7 500
Investment: Ord shares (FP: A) 237 500
NCI (SCE) (20% x 287 500) 57 500
P3 Reval surplus (BOY) (SCE) 4 000
NCI (BOY) (SCE) (20% x 20 000) 4 000
P4 Retained earnings (BOY) (SCE) 9 000
NCI (BOY) (SCE) (125 000 x 12% x 60%) 9 000
P5 Retained earnings BOY) (SCE) 21 558
NCI (BOY) (SCE) 21 558
(167 890 - 37 500 - 15 000 - 8 000 + 400 = 107 790 x 20%)
P6 NCI (PL) (125 000 x 12% x 60%) 9 000
NCI (SCE) 9 000
P7 NCI (PL) 21 049
NCI (SCE) 21 049
(115 110 - 15 000 + 4 000 + 1 600 - 467 = 105 243 x 20%)
P8 Other income (PL: Inc) (40%) 12 000
NCI (SCE) (60%) 18 000
Pref dividednds (SCE) (125 000 x 12% x 2) 30 000
P9 Other income (PL: Inc) (80%) 10 000
NCI (SCE) (20%) 2 500
Ord dividednds (SCE) 12 500
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Question 3 (29 marks) (35 Minutes)
Green Ltd
Statement of cash flows for the year ended 31 May 2016
Cash flows from operating activities
Cash received from customers (a) 5 108 490
Cash paid to suppliers and employees (b) (2 844 800)
Cash generated from operations 2 263 690
Interest received (295 000 - 250 000 - 15 00) 30 000
Interest paid (225 000 + 1 500 - 2 300) (224 200)
Dividends received 15 000
Dividends paid (371 875 - 5 000) (366 875)
Tax paid (534 240 + 20 000 - 53 000) (501 240)
Acquisition of investments held for trade (through profit or loss) (d) (217 000)
Net cash flows from operating activities 999 375
Cash flows from investing activities
Investment in non-current assets to expand
Additions to non-current assets (1 400 000 + 500 000) (1 900 000)
Investment in non-current assets to maintain capacity
Replacement of non-current assets (580 000)
Proceeds from the sale of non-current assets (given) 330 000
Net cash flows from investing activities (2 150 000)
Calculations:
Revenue 4 800 000
Other income (295 000 - 250 000 - 15 000 - 30 000) 0
(Profit: A = 330 000 - 80 000 = 250 000)
(Int = bal fig: 295 000 - 250 000 - 15 000 = 30 000)
Credit losses (3 000)
Trade and other receivables (open) 555 000
Trade and other receivables (clos) (243 510)
5 108 490
(b) Purchases (2 112 000 - 680 000 + 850 000) 2 282 000
Other expenses (850 000 - 248 000 - 3 000 - 17 000) 582 000
Trade and other payables (open) (560 000 - 1 500) 558 500
Trade and other payables (clos) (580 000 - 2 300) (577 700)
2 844 800
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