FIN3703 ASSESSMENT 1 SEM 2 OF 2026 EXPECTED SOLUTIONS

, SECTION A

QUESTION 1

3. b and c

QUESTION 2

1. a

QUESTION 3
Interest = Principal × Rate × (Days/365)
Interest = R350,000 × 10% × (29/365)
Interest = R350,000 × 0.10 × 0.079452
Interest = R2,780.82

QUESTION 4
Limpopo: Debit R400,000 × 10% = R40,000 (Interest payable)
Gauteng: Credit R350,000 × 7% = R24,500 (Interest receivable)
KZN: Debit R200,000 × 10% = R20,000 (Interest payable)
Northwest: Debit R100,000 × 10% = R10,000 (Interest payable)

Net Interest = R40,000 + R20,000 + R10,000 - R24,500 = R45,500 (Net payable)

QUESTION 5
Master account balance = R1,000,000 (debit) + R400,000 (Limpopo) - R350,000 (Gauteng) +
R200,000 (KZN) + R100,000 (Northwest)
Master account balance = R1,350,000 (debit balance)

QUESTION 6
Advantage of pooling = R10,500
Rationale: Without pooling net payable = R45,500. With pooling, net debit R350,000 × 10%
= R35,000. Saving = R45,500 - R35,000 = R10,500 (the spread on R350,000 at 3%).

QUESTION 7
c. transactional

QUESTION 8

3. a and c

QUESTION 9
d. primary; capital