Photo AI
USANDA LIMITED The financial year ended on 28 February 2021 - NSC Accounting - Question 2 - 2020 - Paper 1
Question 2
USANDA LIMITED The financial year ended on 28 February 2021. REQUIRED: 2.2.1 Calculate the following figures for the 2021 Cash Flow Statement: Income tax paid ... show full transcript
Worked Solution & Example Answer:USANDA LIMITED The financial year ended on 28 February 2021 - NSC Accounting - Question 2 - 2020 - Paper 1
Step 1
Calculate the following figures for the 2021 Cash Flow Statement: Income tax paid
Answer
To calculate the income tax paid, use the formula:
Income Tax Paid = Taxable Income - (Tax Rate imes Taxable Income) - Previous Tax Paid.
Using the numbers,
Income Tax Paid = 69,300 + 533,000 - 19,800.
Thus, the Income Tax Paid is R582,600.
Step 2
Calculate the following figures for the 2021 Cash Flow Statement: Dividends paid
Answer
To find the dividends paid, we can apply the formula:
Dividends Paid = Opening Retained Earnings + Net Income - Ending Retained Earnings.
From the data, Dividends Paid = R247,500 - (R835,000 - R340,000).
Therefore, Dividends Paid is R742,500.
Step 3
Prepare the following sections of the Cash Flow Statement: Cash effects for financing activities
Answer
For cash effects from financing activities, we analyze the transactions:
- Proceeds from shares issued: R9,555,000
- Repurchase of shares: R680,000
- Change in loan: R2,800,000 - R270,000
The total cash effects from financing activities are R(2,652,500).
Step 4
Step 5
Calculate the following financial indicators for the year ended 28 February 2021: % operating profit on sales
Answer
Operating profit on sales is calculated using the formula:
% Operating Profit = (Operating Profit / Sales) imes 100.
So, % Operating Profit = (2,262,100 / 17,800,000) imes 100 = 12.7%.
Step 6
Calculate the following financial indicators for the year ended 28 February 2021: Acid-test ratio
Answer
The acid-test ratio is calculated using the formula:
Acid-Test Ratio = (Current Assets - Inventory) / Current Liabilities.
Substituting values:
Acid-Test Ratio = (R659,500 - R270,500) / R(652,200) = 0.61:1.
Step 7
Calculate the following financial indicators for the year ended 28 February 2021: % return on average shareholders' equity (ROSHE)
Answer
To compute ROSHE, the formula is:
% ROSHE = (Net Income / Average Shareholders' Equity) imes 100.
Substituting the values, % ROSHE = (R1,243,900 / R(11,985,400)) imes 100 = 10.37%.
Step 8
Calculate the following financial indicators for the year ended 28 February 2021: Dividend payout rate (%)
Answer
The dividend payout rate is calculated as:
Dividend Payout Rate = (Dividends / Net Income) imes 100.
With our values, Dividend Payout Rate = (R30 cents imes 3 or R0.30) / R1,243,900 imes 100.
Hence, the percentage comes out to be 67.6%.