Grade 12

Accounting

0/9 Topics completed

Companies

01Companies: shares and financial statementsSince the Companies Act 71 of 2008, new shares have no par value. The whole issue price is ordinary share capital, not a share premium.
02Cash flow statementCash from operations starts at profit, adds back depreciation, and subtracts an increase in inventory. Buying a vehicle is an investing outflow, not an operating expense.

Reconciliations

03ReconciliationsThe debtors control account must equal the debtors list. A difference is a missing or misposted entry, not a new sale.

VAT

04VATVAT payable is output VAT on sales minus input VAT on purchases. It is not 15% of the profit.

Inventory

05Inventory systemsUnder FIFO the oldest units are sold first. Closing inventory is what remains, at the newest cost.

Budgets

06BudgetsA cash budget forecasts closing cash from opening cash, expected receipts and expected payments. It is not a VAT invoice.

Assets

07Fixed assetsOn disposal, compare the cash received with the carrying amount. Carrying amount is cost minus accumulated depreciation.

Theory

08Ethics and internal controlInternal control is the set of checks that protects cash and stock, and ethics is doing the honest thing when a check is missing or when a personal gain clashes with the books.

Manufacturing

09Manufacturing: production cost statementA factory's cost of production adds direct materials, direct labour and factory overheads, then adjusts for work-in-progress that is not yet finished.