EMS- Mock Exam

Grade 8

Paper 1- Memorandum

Instructions:

1. This paper consists of 6 pages

2. This paper consists of 3 questions

3. Answer all the questions.

4. Number your answers as per the question paper.

5. Skip a line between answers.

6. Do NOT answer on the question paper.

7. Answer all questions on lined paper.

8. Show calculations where possible.

Section A: Question Possible Marks Student’s Marks

1
2
3
Total 50

©E-classroom 1 www.e-classroom.co.za
 Section A: Financial literacy

Question 1: Short Questions

1.1 Match the term from column A to the definition in column B and write your answers in the blocks provided.

Column A: Terms Column B: Definitions

1.1 An entry found on the left side of the A. Overdraft
General Ledger
1.2 Money kept in a box to pay for minor B. Posting
expenses
1.3 Anything taken from the business for the C. Debit
owner’s personal use
1.4 When money is withdrawn from a bank D. Drawings
account and the balance goes below zero
1.5 Information from the journals transferred E. Petty cash
to the general ledger

1.1 C 1.2 E 1.3 D 1.4 A 1.5 B

1.2 True or false: Answer true or false to the following questions and provide an explanation for your choice. (5)

1.2.1 Income and expenses are recorded in the nominal section in the general ledger.
True, they are recorded in the nominal section, not the balance sheet section.
1.2.2 For every debit, there is another debit entry.
False, for every debit, there is a credit entry (double entry rule)
1.2.3 Cash float have a short lifespan; therefore, it’s classified as a non- current asset.
False, cash float is a current asset, as it has a short life span.
1.2.4 Consumables are referred to as an expense.
True, as consumables are quickly consumed, they don’t hold enough value to be considered an asset.
1.2.5 A transaction is an agreement between a consumer and a producer to exchange something of value.
True, when a buyer and a seller make a financial agreement, it is referred to as a transaction.
Total for Question 1: 10

Question 2: Longer questions

2.1 Do you think that its necessary to have an analysis of receipts and bank column in the Cash Receipts Journal?
Give reasons for your answer. (2)
It is necessary to have both columns- the bank amount is the total for the day, as well direct payments into the
bank. (The bank column represents all the debits, because with every transaction that causes an increase in the
balance of the bank account, we will debit the bank account, and credit one or more other accounts.) The
analysis column can be thought of as the “till” or “cash register” column. (The purpose of this column is
to show that various forms of cash (i.e. hard cash and cheques) are collected in the cash register first, before
these funds are periodically (sometimes daily) deposited into the bank account.)

©E-classroom 2 www.e-classroom.co.za
 2.2 Audrey started her own mobile beauty business in December 2019. She’s contracted by large firms to make
weekly “pamper” visits for all their staff. Audrey has two therapist that she employs on a part time basis for one
call out per week. Use the information provided below to analyse the transactions according to the accounting
equation. (8)

Transactions for December 2019

4 Paid for petrol for the month , R1 000.
10 Received R 1 200 for her services at Board Attorneys.
22 Paid wages for the week. Each therapist earns R 500 a week.
28 Bought consumables (exfoliator, soap and cream) to use while rendering the service, R384.
EFFECT ON ACCOUNTING EQUATION
NO JOURNAL ASSETS OWNER’S EQUITY
EFFECT REASON EFFECT REASON
4 CPJ Bank is credited Assets Owner’s Petrol is an
decrease equity is expense,
(Money out debited expenses
of bank) decrease OE
10 CRJ Bank is Debited Assets Owner’s Money
increase equity is received is an
(Money into credited income,
bank) income
increases OE
22 CPJ Bank is credited Assets Owner’s Wages is an
decrease equity is expense,
(Money out debited expenses
of bank) decrease OE
28 CPJ Bank is credited Assets Owner’s consumables
decrease equity is are an
(Money out debited expense,
of bank) expenses
decrease OE

Total for Question 2: 10

©E-classroom 3 www.e-classroom.co.za
 Question 3: Case studies

3.1 Use the transactions shown below to complete the cash receipts journal of Dr. Tracey Brandt for June 2019. (10)

Transactions for June 2019

2 Treated a family of four and received R900. Issued receipt 86.
6 Received R150 interest from Firm Bank on a fixed deposit held by the business.
14 Provided private check-ups at the Phillips’ family home. Received R1200
19 Tracey increased her capital contribution by R15 000. She made a direct deposit into the business’ bank account.

Cash Receipts Journal of Dr Tracey Brandt for June 2019 (CRJ 1)

Analysis Sundry Accounts

Doc
Day Details of Bank Income
no. Amount Details
receipts

86 2 Services rendered 900 900 900

Interest
87 6 Firm bank 150 150 150 (1)
earned

89 14 Services rendered 1 200 1 200 1200

90 19 Dr. Tracey Brandt 15 000 15 000 15000 Capital (1)

17 250 2 100 15 150

(1) (1) (3) (3)

3.2 Post the Cash receipts and Cash payments journal of Brown’s Plumbing to the General ledger on 31 July 2019.
Total or balance the necessary accounts. (20)

Cash Receipts Journal of Brown’s plumbing for July 2019

D D Bank Current Sundry accounts
o A Details Analysis Income Amount Fol Details
c y of receipts
R20 1 Mr. D Brown 50 000 50 000 50 000 Capital
CRR 5 Service 12 500 12 500 12 500
Rendered
CRR Service 6 000 6 000 6 000
Rendered

68 500 18 500 50 000

©E-classroom 4 www.e-classroom.co.za
 Cash Payments Journal of Brown’s plumbing for July 2019
D D Sundry accounts
o A Name of Payee Bank Wages Amount Fol Details
c y
002 Plunger and 750 750 Consumable goods
Taps
003 5 Cash 280 280
004 10 Mr D Brown 300 300 Drawings
006 12 Cash 548 548

1 878 828 1 050

Use the provided layout of the General Ledger as a guideline

General Ledger of Brown’s Plumbing
Balance sheet section
Capital
July 1 Bank CRJ 50 000
2019

Drawings
July 10 Bank CPJ 300
2019

Bank
July 31 Total receipts CRJ 68 500 July 31 Total Payments CPJ 1 878
2019 2019
Balance c/d 66 622
68 500 68 500
Aug 1 Balance b/d 66 622
2019

Nominal account section

Current income
July 31 Bank CRJ 18 500
2019

Wages
July 31 Bank CPJ 828
2019

©E-classroom 5 www.e-classroom.co.za
 Consumable goods
July 31 Bank CPJ 750
2019

Total for Question 3: 30

Grand Total for Paper 1: 50

©E-classroom 6 www.e-classroom.co.za