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QUESTION ONE (20 MARKS) THE FOLLOWING INFORMATION WAS EXTRACTED FROM THE RECORDS OF UNITY SUPPLIERS 28 FEBRUARY 2020 Inventory (1 March 2019) Trade receivables Trade payables Purchases Purchases returns Settlement discount granted Freight on sales Sales returns Insurance expenses Settlement discount received Allowance for credit losses Allowance for settlement discount granted Carriage on purchases Insurance on purchase Bank Additional information: R 43 000 150 000 65 000 174 000 4 100 3217 14 100 2 300 48 160 1000 1 900 4 500 200 1300 112 580 1. On 28 February 2020 the inventory on hand amounted to R65 000 2. Included in the amount of inventory on hand is consumables and stationery amounting to R2 080 and R800 3. The owner took some of the stock bought for R3 800 as a gift for his aunt. 4. Unity Supplies were offered a discount of 10% on an amount of R9 500 owing to a supplier provided the supplier is paid before 28 February 2020. Unity Supplies intends taking the advantage of the discount offered. 5. Unity maintains a mark-up on sales (margin) of 40%. 6. The balance of the allowance for settlement discount granted account on 1 Jan 2020 must be written back since the trade debtor to whom the discount offering pertained did not settle his account as required. On 31 December 2020, a trade debtor who owes R34 000 was offered a 5% settlement discount, on condition that she settles her account before 15 January 2021. This offering must still be provided for. Required Determine the Revenue Amount for the year ended 28 February 2020.

QUESTION ONE (20 MARKS) THE FOLLOWING INFORMATION WAS EXTRACTED FROM THE RECORDS OF UNITY SUPPLIERS 28 FEBRUARY 2020 Inventory (1 March 2019) Trade receivables Trade payables Purchases Purchases returns Settlement discount granted Freight on sales Sales returns Insurance expenses Settlement discount received Allowance for credit losses Allowance for settlement discount granted Carriage on purchases Insurance on purchase Bank Additional information: R 43 000 150 000 65 000 174 000 4 100 3217 14 100 2 300 48 160 1000 1 900 4 500 200 1300 112 580 1. On 28 February 2020 the inventory on hand amounted to R65 000 2. Included in the amount of inventory on hand is consumables and stationery amounting to R2 080 and R800 3. The owner took some of the stock bought for R3 800 as a gift for his aunt. 4. Unity Supplies were offered a discount of 10% on an amount of R9 500 owing to a supplier provided the supplier is paid before 28 February 2020. Unity Supplies intends taking the advantage of the discount offered. 5. Unity maintains a mark-up on sales (margin) of 40%. 6. The balance of the allowance for settlement discount granted account on 1 Jan 2020 must be written back since the trade debtor to whom the discount offering pertained did not settle his account as required. On 31 December 2020, a trade debtor who owes R34 000 was offered a 5% settlement discount, on condition that she settles her account before 15 January 2021. This offering must still be provided for. Required Determine the Revenue Amount for the year ended 28 February 2020.

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter5: Sales And Receivables
Section: Chapter Questions
Problem 81BPSB
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QUESTION ONE (20 MARKS) THE FOLLOWING INFORMATION WAS EXTRACTED FROM THE RECORDS OF UNITY SUPPLIERS 28 FEBRUARY 2020 Inventory (1 March 2019) Trade receivables Trade payables Purchases Purchases returns Settlement discount granted Freight on sales Sales returns Insurance expenses Settlement discount received Allowance for credit losses Allowance for settlement discount granted Carriage on purchases Insurance on purchase Bank Additional information: R 43 000 150 000 65 000 174 000 4 100 3217 14 100 2 300 48 160 1000 1 900 4 500 200 1300 112 580 1. On 28 February 2020 the inventory on hand amounted to R65 000 2. Included in the amount of inventory on hand is consumables and stationery amounting to R2 080 and R800 3. The owner took some of the stock bought for R3 800 as a gift for his aunt. 4. Unity Supplies were offered a discount of 10% on an amount of R9 500 owing to a supplier provided the supplier is paid before 28 February 2020. Unity Supplies intends taking the advantage of the discount offered. 5. Unity maintains a mark-up on sales (margin) of 40%. 6. The balance of the allowance for settlement discount granted account on 1 Jan 2020 must be written back since the trade debtor to whom the discount offering pertained did not settle his account as required. On 31 December 2020, a trade debtor who owes R34 000 was offered a 5% settlement discount, on condition that she settles her account before 15 January 2021. This offering must still be provided for. Required Determine the Revenue Amount for the year ended 28 February 2020.
Transcribed Image Text:QUESTION ONE (20 MARKS) THE FOLLOWING INFORMATION WAS EXTRACTED FROM THE RECORDS OF UNITY SUPPLIERS 28 FEBRUARY 2020 Inventory (1 March 2019) Trade receivables Trade payables Purchases Purchases returns Settlement discount granted Freight on sales Sales returns Insurance expenses Settlement discount received Allowance for credit losses Allowance for settlement discount granted Carriage on purchases Insurance on purchase Bank Additional information: R 43 000 150 000 65 000 174 000 4 100 3217 14 100 2 300 48 160 1000 1 900 4 500 200 1300 112 580 1. On 28 February 2020 the inventory on hand amounted to R65 000 2. Included in the amount of inventory on hand is consumables and stationery amounting to R2 080 and R800 3. The owner took some of the stock bought for R3 800 as a gift for his aunt. 4. Unity Supplies were offered a discount of 10% on an amount of R9 500 owing to a supplier provided the supplier is paid before 28 February 2020. Unity Supplies intends taking the advantage of the discount offered. 5. Unity maintains a mark-up on sales (margin) of 40%. 6. The balance of the allowance for settlement discount granted account on 1 Jan 2020 must be written back since the trade debtor to whom the discount offering pertained did not settle his account as required. On 31 December 2020, a trade debtor who owes R34 000 was offered a 5% settlement discount, on condition that she settles her account before 15 January 2021. This offering must still be provided for. Required Determine the Revenue Amount for the year ended 28 February 2020.
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