FAC1602
EXAM PACK
,FAC1602 Semester 1 2026
Elementary Financial Accounting Reporting
EXAM ANSWERS
QUESTION 1 — Statement of Profit or Loss and OCI
Kwagga Packaging CC
Statement of Profit or Loss and Other Comprehensive Income for the year ended
28 February 2026
Calculations
1. Revenue
Sales = R319 900
2. Cost of sales
Cost of sales=Opening inventory+Purchases+Carriage on purchases−Closing inventory
\text{Cost of sales}= \text{Opening inventory}+\text{Purchases}+\text{Carriage on
purchases}-\text{Closing inventory}
=13 200+58 400+1 300−9 800=13\,200+58\,400+1\,300-9\,800
=R63 100=\boxed{R63\,100}
3. Settlement discount granted
Settlement discount granted = R215 600
,4. Credit losses
Existing allowance = R31 600
Allowance must decrease by R5 800:
31 600−5 800=25 80031\,600-5\,800=25\,800
Customer written off = R2 300.
Therefore, the net credit-loss expense is:
2 300−5 800=(R3 500)2\,300-5\,800=\boxed{(R3\,500)}
The negative amount represents an income/reversal of credit losses.
5. Interest expense
Loan from Thabiso = R104 000
Interest = 9%:
104 000×9%=R9 360104\,000\times9\%=\boxed{R9\,360}
The R7 200 already calculated must therefore be included as interest expense only if it
represents the correctly calculated amount given by the question. However, the
question states that interest was correctly calculated at R7 200, so:
Interest expense=R7 200\boxed{\text{Interest expense}=R7\,200}
6. Interest income
, Loan to Lerato = R83 600
Granted on 1 October 2025 → 5 months
83 600×11%×51283\,600\times11\%\times\frac{5}{12} =R3 832=\boxed{R3\,832}
7. Salaries
Total salaries = R110 500.
The members' salaries of R34 000 each are already included:
34 000+34 000=68 00034\,000+34\,000=68\,000
Therefore, no further adjustment is required.
8. Depreciation
Buildings:
R28 000R28\,000
Manufacturing equipment:
R37 600R37\,600
Total:
28 000+37 600=R65 60028\,000+37\,600=\boxed{R65\,600}
9. Current income tax
Current tax = R3 500.
EXAM PACK
,FAC1602 Semester 1 2026
Elementary Financial Accounting Reporting
EXAM ANSWERS
QUESTION 1 — Statement of Profit or Loss and OCI
Kwagga Packaging CC
Statement of Profit or Loss and Other Comprehensive Income for the year ended
28 February 2026
Calculations
1. Revenue
Sales = R319 900
2. Cost of sales
Cost of sales=Opening inventory+Purchases+Carriage on purchases−Closing inventory
\text{Cost of sales}= \text{Opening inventory}+\text{Purchases}+\text{Carriage on
purchases}-\text{Closing inventory}
=13 200+58 400+1 300−9 800=13\,200+58\,400+1\,300-9\,800
=R63 100=\boxed{R63\,100}
3. Settlement discount granted
Settlement discount granted = R215 600
,4. Credit losses
Existing allowance = R31 600
Allowance must decrease by R5 800:
31 600−5 800=25 80031\,600-5\,800=25\,800
Customer written off = R2 300.
Therefore, the net credit-loss expense is:
2 300−5 800=(R3 500)2\,300-5\,800=\boxed{(R3\,500)}
The negative amount represents an income/reversal of credit losses.
5. Interest expense
Loan from Thabiso = R104 000
Interest = 9%:
104 000×9%=R9 360104\,000\times9\%=\boxed{R9\,360}
The R7 200 already calculated must therefore be included as interest expense only if it
represents the correctly calculated amount given by the question. However, the
question states that interest was correctly calculated at R7 200, so:
Interest expense=R7 200\boxed{\text{Interest expense}=R7\,200}
6. Interest income
, Loan to Lerato = R83 600
Granted on 1 October 2025 → 5 months
83 600×11%×51283\,600\times11\%\times\frac{5}{12} =R3 832=\boxed{R3\,832}
7. Salaries
Total salaries = R110 500.
The members' salaries of R34 000 each are already included:
34 000+34 000=68 00034\,000+34\,000=68\,000
Therefore, no further adjustment is required.
8. Depreciation
Buildings:
R28 000R28\,000
Manufacturing equipment:
R37 600R37\,600
Total:
28 000+37 600=R65 60028\,000+37\,600=\boxed{R65\,600}
9. Current income tax
Current tax = R3 500.
