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GLYDIS TRADERS Information is provided for the budget period ending 31 July 2022 - NSC Accounting - Question 4 - 2022 - Paper 2
Question 4
GLYDIS TRADERS Information is provided for the budget period ending 31 July 2022. REQUIRED: 4.1.1 Complete the Debtors' Collection Schedule for July 2022. 4.1.2 Ca... show full transcript
Worked Solution & Example Answer:GLYDIS TRADERS Information is provided for the budget period ending 31 July 2022 - NSC Accounting - Question 4 - 2022 - Paper 2
Step 1
Complete the Debtors' Collection Schedule for July 2022
Answer
The Debtors' Collection Schedule for July 2022 can be calculated based on the credit sales and the repayment trends outlined. The total sales for July are R1 015 000. Thus, the credit sales for June, which will be collected in July, amount to 45% of R997 500:
- June Collections:
- 10% of R1 015 000 = R609 000 (current month)
- 40% of R997 500 = R398 200 (prior month with discount)
- 12% of R567 500 = R68 100 (2 months prior)
The total receipts for July 2022 will be the sum of these collections. After applying respective discounts, the final figure for collections amounts to R555 345.
Step 2
Calculate the amounts denoted by (i) to (iv) in the extract of the Projected Statement of Comprehensive Income
Answer
To calculate relevant amounts:
(i) Commission income in July 2022:
- Formula: Total Sales × Commission Rate
- Calculation: R1 015 000 × 8% = R81 200
(ii) Bad debts written off in July 2022:
- Formula: 3% of Credit Sales not collected = 3% of R567 500
- Calculation: R17 010
(iii) Salaries and wages in July:
- Salaries will remain similar as per previous months and assume full payment.
- Calculation: R187 000
(iv) Discount allowed in June 2022:
- Formula: 5% of July Credit Sales allowed.
- Calculation: 5% of R239 430 = R11 970.
Step 3
Payments to creditors in July 2022
Answer
Payments to creditors can be calculated as follows:
- Purchases in June amount to R997 500, and they are paid in the month after.
- The formula for calculating the payment is 75% of the cost of stock purchased.
- Thus, Payment = R1 012 500 × 80% (amount bought on credit) = R110 000.
Step 4
Loan amount that will be paid on 1 July 2022
Answer
To calculate the loan amount to be paid on July 1, we refer to the outstanding loan balance and the interest applicable.
- Remaining balance = previous loan principal amortized under the agreement.
- Calculation: Loan repayment = R525 000 × 0.14 (interest) = R45 000.