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VAT Amahle Traders is registered for VAT - NSC Accounting - Question 1 - 2020 - Paper 2
Question 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. (9) 1.1... show full transcript
Worked Solution & Example Answer:VAT Amahle Traders is registered for VAT - NSC Accounting - Question 1 - 2020 - Paper 2
Step 1
Comment on this practice and provide Amahle advice.
Answer
It is unethical for Amahle to use money not earned by the business for personal or unrelated expenses. The business is an agent of SARS and must make payments timely or face penalties for non-compliance. Additionally, this practice may lead to an audit or further investigation, which could harm the business.
Advice: Amahle should:
- Keep proper records to ensure accurate tax submissions in the future.
- Adhere to submission dates to avoid penalties.
- Only use business funds in accordance with the budget and business commitments.
Step 2
Use the table to indicate changes to the Creditors' Ledger Account.
Answer
For the creditors' ledger, the changes include the original balance of R117,200:
- Subtracting R49,100 yields a new balance.
- Adjusting for R12,500 will also affect the total.
- Further changes may include adjustments for any potential discrepancies identified.
Careful adjustments will ultimately result in the revised balance in the statement.
Step 3
Explain TWO points regarding the incident involving Bradley.
Answer
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Bradley should not use his position to make personal gains or have conflicts of interest which could jeopardize the integrity of the business's operations.
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Any misconduct regarding the pricing of goods should be investigated thoroughly; failure to report such could lead to serious disciplinary actions, including dismissal.