NATIONAL

SENIOR CERTIFICATE

GRADE 10

NOVEMBER 2020

ACCOUNTING P1
MARKING GUIDELINE
(EXEMPLAR)
MARKS: 150

MARKING PRINCIPLES:
1. Penalties for foreign items are applied only if the candidate is not losing marks elsewhere in the
question for that item (no foreign item penalty for misplaced items). No double penalty applied.
2. Penalties for placement or poor presentation (e.g. details) are applied only if the candidate is
earning marks on the figures for that item.
3. Full marks for correct answer. If the answer is incorrect, mark the workings provided.
4. If a pre-adjustment figure is shown as a final figure, allocate the part-mark for the working for that
figure (not the method mark for the answer). Note: if figures are stipulated in memo for components
of workings, these do not carry the method mark for final answer as well.
5. Unless otherwise indicated, the positive or negative effect of any figure must be considered to
award the mark. If no + or – sign or bracket is provided, assume that the figure is positive.
6. Where indicated, part-marks may be awarded to differentiate between differing qualities of
answers from candidates.
7. Where penalties are applied, the marks for that section of the question cannot be a final negative.
8. Where method marks are awarded for operation, the marker must inspect the reasonableness of
the answer before awarding the mark.
9. 'Operation' means 'Check operation'. 'One part correct' means 'Operation and one part correct'.
Note: Check operation must be +, –, x or ÷ or per candidates’ response.
10. In calculations, do not award marks for workings if numerator and denominator are swapped –
this also applies to ratios.
11. In awarding method marks, ensure that candidates do not get full marks for any item that is
incorrect at least in part. In such cases, do not award the method mark. Indicate by way of 
12. Be aware of candidates who provide valid alternatives beyond the marking guideline.
13. Codes: f = foreign item; p = placement/presentation.

This marking guideline consists of 6 pages.

2 ACCOUNTING P1 (EC/NOVEMBER 2020)

QUESTION 1: ACCOUNTING CONCEPTS AND ACCOUNTING EQUATION

1.1 CONCEPTS
1.1.1 C 
1.2.2 E 
1.2.3 B 
1.2.4 A 
4

1.2 ACCOUNTING EQUATION

NO. ASSETS OWNER’S EQUITY LIABILITIES

REASON EFFECT REASON EFFECT REASON EFFECT
1.2.1 Bank +1 000 Interest on fixed +1 000
deposit
1.2.2 Equipment +/-
Bank 24 000
1.2.3 Interest Paid  -288 Creditors’ +288
control
1.2.4 (a) Bank +2 700 Sales +2 700
(b) Trading stock -1 800 Cost of sales -1 800

20

TOTAL MARKS
24

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 (EC/NOVEMBER 2020) ACCOUNTING P1 3

QUESTION 2: CONCEPTS AND INCOME STATEMENT

2.1
2.1.1 D 
2.1.2 C 
2.1.3 B 
2.1.4 A 
4

2.2.1 INCOME STATEMENT OF KINGSTON TRADERS FOR THE YEAR ENDED

29 FEBRUARY 2020
Sales (950 000  + 18 200  – 14 000 )  954 200
Cost of Sales (400 000  + 13 000 )  (413 000)
Gross Profit  541 200
Other operating Income  123 830
Discount received 830
Rent income (39 000 – 3 000)  36 000
Fee Income (82 600 + 2 400 )  85 000
Trading stock surplus (231 000 – 13 000 – 220 000) 2 000
Gross operating income 665 030
Operating Expenses  (258 560)
Discount allowed 1 260
Stationery 8 800
Salaries and wages (168 000  + 10 000 ) or
(168 000  + 7 300  + 2 700 )  178 000
Insurance (16 800  – 2 400 )  14 400
Bad Debts (1 300  + 700 )  2000
Consumable Stocks (5 500  – 500 )  5 000
Depreciation (32 000  + 17 100 )  49 100
Operating Profit  406 470
Interest Income (900 + 1 870 ) 1  2 770
Profit before Interest Expense  409 240
Interest Expense 2  (30 800)
Net Profit for the Year  378 440 45
 operation, one part correct; Foreign entries -1 (max.2), accept alternative format (two columns)

TOTAL MARKS
49

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 4 ACCOUNTING P1 (EC/NOVEMBER 2020)

QUESTION 3: CONCEPTS, FIXED ASSETS, BALANCE SHEET, INTERPRETATION

AND INTERNAL CONTROL

3.1 CONCEPTS

3.1.1 Return on investment 

3.1.2 Liquidity 
3.1.3 Profitability 
3.1.4 Solvency  (4)

3.2.1 (a) R1 200 000 – R600 000 = R600 000   (2)

(b) R700 000 – R280 000 = R420 000   (2)

(c) R420 000 x 20/100 = R84 000 (old)

R145 000  x 20/100 x 9/12 = 21 750 (new)

R105 750 (6)

(d) R420 000 + R145 000  – R105 750 = R459 250 (4) 14

3.2.2 BALANCE SHEET OF OBBIE TRADERS – 30 APRIL 2020

ASSETS
NON-CURRENT ASSETS  2 049 200
Fixed (tangible) assets  1 931 250
Financial assets: Fixed deposit balancing figure  117 950
CURRENT ASSETS operation, one part correct  550 800
INVENTORIES 270 200
TAOR (162 000+ 3 200+ 1 200) operation, one part correct  166 400
CACE (112 000 + 2 200 ) operation, one part correct  114 200
TOTAL ASSETS  2 600 000
EQUITY AND LIABILITIES
OWNER’S EQUITY 2 186 400

NON-CURRENT LIABILITIES 280 000

Loan (423 200 – 103 200 – 40 000) operation, one part correct  280 000
CURRENT LIABILITIES  133 600
TAOP (86 000 + 5 800 + 1 800) operation, one part correct  93 600
Short-term loan  40 000
TOTAL EQUTY AND LIABILITIES 2 600 000
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 (EC/NOVEMBER 2020) ACCOUNTING P1 5

3.3 Financial indicators

(a) 550 800 

Current ratio =
133 600 

= 4,1 : 1  3

(b) 550 800  – 270 200 

Acid test ratio =
133 600 

= 2,1 : 1  4

(c) No.

- The current ratio improved from 0,9 : 1 in 2019 to 4,1 : 1 in 2020. 

- The acid test ratio also improved from 1,3 : 1 in 2019 to 2,1 : 1 in 2020. 

- Both ratios show an improvement. 

- These ratios indicate that that business could be able to meet its short-
term obligations. The business should continue to try and improve these
ratios.  4

3.4 This is not essential as the return being earned by the business exceeds the interest
rate on the loan.  However, it does not make sense to have surplus cash invested
at a lower rate than the 15% (e.g. the fixed deposit). It would make sense to repay
the loan provided there is no other urgent use for the money.  4

TOTAL MARKS
55

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6 ACCOUNTING P1 (EC/NOVEMBER 2020)

QUESTION 4: WAGES JOURNAL AND INTERNAL CONTROL

4.1 CONCEPTS

4.1.1 E 
4.1.2 D 
4.1.3 A 
4.1.4 B 
4

4.2.1 R110 000 – R25 000  = R85 000 

2

4.2.2 Deductions are the payments that are made by the employer on behalf of
the employee,  while contributions are made by the business of the
employee and are paid in addition to the deductions, and these employer
contributions are additional expenses to the business.  4

4.2.3 R25 000 x R25

R35 000 
R110 000  – R75 000  =
R35 

= 1 000 hours  5

4.2.4 R7 000  + R14 000  = R21 000 

3

4.2.5 - Accuracy in the workplace 

- Increased productivity 
- Track absenteeism 
- Track employees work hours 
- Increased employee satisfaction  (Any 2 relevant) 4

TOTAL MARKS
22

TOTAL: 150

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