1.1 VAT
Amahle Traders is registered for VAT - NSC Accounting - Question 1 - 2020 - Paper 2
Question 1
1.1 VAT
Amahle Traders is registered for VAT. The standard VAT rate is 15%.
REQUIRED:
1.1.1 Calculate the figures indicated by (a) to (d) in the table below.
1.1.2... show full transcript
Worked Solution & Example Answer:1.1 VAT
Amahle Traders is registered for VAT - NSC Accounting - Question 1 - 2020 - Paper 2
Step 1
Calculate (a) Excluding VAT from Invoices Received from Suppliers
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Answer
To find the VAT included in the total invoices received, we subtract the amounts:
a=R89,700−R78,000=R11,700
Step 2
Calculate (b) VAT on Discount Received from Suppliers
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For the discount amount, we calculate the VAT:
b = R12,400 imes 15 rac{1}{15} = R1,860
Step 3
Calculate (c) VAT on Credit Notes Issued to Customers
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For credit notes issued, we can determine the NET from the total:
c = R210 + (R1,400 imes 15 rac{1}{15}) = R1,610
Step 4
Calculate (d) VAT on Invoices Issued to Customers
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Answer
It is unethical to use personal funds to settle business obligations.
This could lead to issues with SARS and could result in future penalties.
Amahle should keep proper records, avoid using funds from the business for personal expenditure, ensure payments are made accurately, and only use resources within the budget established by the business.
Step 6
Creditor's Ledger Account Changes
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Referencing the ledger statements and reconciling balances:
Creditors' Ledger Account must accurately reflect all transactions relevant to Thembeka Suppliers.
Adjustments must align with common accounting practices, ensuring no discrepancies occur.
Step 7
What Should the Owner Advise Bradley?
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Bradley must not exploit his position for personal gain, maintaining professionalism in all dealings.
He should be reminded of the integrity required in business transactions, as unethical behavior could lead to disciplinary action or termination.
