FACULTY OF COMMERCE,
MANAGEMENT & LAW
DISTANCE MODE ASSIGNMENT
LETTER
Old Curriculum
Academic Year 2024
Semester (1)
[Financial Accounting 2A- AFE3781]
A MUST, TO READ THE ENTIRE
DOCUMENT
Page 1 of 25
FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
ACCOUNTING, ECONOMIC & MANAGEMENT
SCIENCES
ASSIGNMENT ADMINISTRATION
CORE CALENDAR FOR DISTANCE AND ONLINE COURSES – 2024
SEMESTER 1
MONTH
DATES
February
5 February
12 February
March
25-28 March 2023
ACTIVITIES
Schools
Creation of Moodle courses for Distance and Online mode
Orientation
Semester 1 Lectures Commences
Compulsory Virtual Vacation School
All Schools
FIRST ASSESSMENT: 1st SEMESTER MODULES
April
2 April
3-5 April
Due date: 01st Assessment of 01 Semester Modules Only
Grace Period for assessment submission/ completion
School of Accounting, School of Business
Management, Governance & Economics
School of Law
MAKE-UP/ COMPENSATORY ASSESSMENT 1: 1st SEMESTER MODULES
April
17 April
Make-up assessment due date: 1st Assessment
– Only applicable if you score 1-39% in Assignment 1.
Take note that a new assessment (test or assignment) is
to be submitted.
Page 2 of 25
School of Accounting, School of Business
Management, Governance & Economics
School of Law
FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
SECOND ASSESSMENT: 1st SEMESTER MODULES
19 April
20-22 April
April
Due date: 02nd Assessment of 01 Semester Modules Only
Grace Period for assessment submission/ completion
School of Accounting, School of Business
Management, Governance & Economics
School of Law
MAKE-UP/ COMPENSATORY ASSESSMENT 2: 1st SEMESTER MODULES
7 May
Make-up assessment due date: 2nd Assessment
– Only applicable if you score 1-39% in Assignment 2.
Take note that a new assessment (test or assignment) is
to be submitted.
School of Accounting, School of Business
Management, Governance & Economics
School of Law
Year Modules
30 April
Due date: Year modules Assignment 1
1-3 May
Grace Period: Year module Assignment 1
17 May
Make-up/ Compensatory assessment due date: 1st
Assessment Year Modules
– Only applicable if you score 1-39% in Assignment 1.
Take note that a new assessment (test or assignment) is
to be submitted.
Due date: Year modules Assignment 2
Grace Period: Year module Assignment 2
May
July
29 July
30 July – 1 August
August
19 August
Make-up/ Compensatory assessment due date: 2nd
Assessment Year Modules
– Only applicable if you score 1-39% in Assignment 2.
Take note that a new assessment (test or assignment) is
to be submitted.
Page 3 of 25
School of Accounting, School of Business
Management, Governance & Economics
School of Law
School of Accounting, School of Business
Management, Governance & Economics
School of Law
FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
2 September
September
Due date: Year modules Assignment 3
3-5 September
Grace Period: Year module Assignment 3
20 September
15 May 2024
Make-up/ Compensatory assessment due date: 3rd
Assessment Year Modules
– Only applicable if you score 1-39% in Assignment 3.
Take note that a new assessment (test or assignment) is
to be submitted.
Lectures end for First Semester
21 May 2024
22 May 2024
Release of CA Marks
Semester 1 First opportunity Examinations
11 June 2024
Semester 1 Second opportunity Examinations
School of Accounting, School of Business
Management, Governance & Economics
School of Law
All Schools
For modules that will have online tests, all information shall be communicated well in advance. Kindly take note that some modules might
have 3 to 4 assessments. E.g.
2 assignments and 1 to 2 online tests. All necessary information will be shared timely.
Good luck!
Page 4 of 25
FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
2024 Distance Mode Assignments
[Financial Accounting 2A- AFE3781 ]
Dear Student,
Welcome to the University of Namibia. We are confident that your studies and hard work will be
rewarded with success. We kindly advise that you obtain all the relevant information and booklets
available for distance students from your Moodle platform (including the 2023 Student Information
Letter, Online Assignment Submission Guide and other documents). These documents will
provide guidance on how to approach your studies and will guide you through your study materials as
well as providing useful administrative information in submitting assignments.
1. Study materials
Your study guide is essentially your “teacher/lecturer”. However, in addition, you are required to visit
the library to consult prescribed books and recommended readings that are indicated in the study guide
as well as browse the Internet in general. You are also responsible to purchase any prescribed
textbooks required for your respective courses/modules. Furthermore, you are strongly advised to
follow the guidelines in the Online Assignment Submission Guide available on Moodle.
2. Collaborative Learning
Unam avails all your modules through Moodle, enabling you to interact with your fellow students online
through forum discussions and chats. You can use the same platform to engage with your lecturers and
tutors regarding academic support. Please take advantage of Moodle to avoid isolation and strengthen
your interaction with colleagues, ask for help, and share/receive resources to aid your learning process.
See below how to access forum discussions on Moodle:
Figure 1: Forums in courses
3. Submission of assignments
It is very important to complete and submit a clean, clear and well-argued assignment for marking. Make
sure that you have understood the questions in order to answer them correctly. It is your responsibility
to make sure that every page of the completed assignment is correctly numbered before submitting
your assignment.
As from 2017, ALL assignments are submitted through the Moodle Learning Management
System. This is an online platform where you will access all your modules and related information such
as course outlines, course notes and other learning materials that your lecturer/tutor may choose to
share with you. Moodle is accessible here: http://elearning.unam.edu.na. You should complete and
submit all assignments on or before the given due date in the assignment letter if you wish to obtain
your CA marks and qualify for examinations. UNAM always updates its assignment covers on an annual
and semester basis. Please ensure that you have used the latest assignment cover. The latest
assignment cover is availed on each course on Moodle.
A user guide is available on how to submit your assignment in each module on the Distance Education
Common Space and you can access it on the Online Support system. Pay close attention to the
following key points listed at the beginning of the guide on:
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
3.1 How you would know when you have successfully submitted your
assignment: that is when the submission status shows “Submitted for grading”
Figure 2: Assignment submission status
MAKE SURE THE SYSTEM GIVES YOU A CONFIRMATION OF SUBMISSION by the
submission status shown as "Submitted for grading" when done. If that status is NOT
displayed when done, IT DOES NOT COUNT AS A SUBMISSION.
3.2 Errors to avoid when submitting your assignment (committing these errors may
result in you failing to submit your assignments and therefore potentially failing your
course)
a. You are submitting on the correct Module/Course
b. You have selected and uploaded the correct Assignment document from your
computer
c. You are submitting the correct Assignment number for the respective activity (i.e.
Assignment 1, 2, etc.)
3.3 How to check the assessment feedback when your assignment has been graded.
4. Due Dates
All assignment due dates for 2022 are published on second page of this assignment letter. With the
shift from manual to online assignment submission since 2017, due dates are automated and nonnegotiable. This means that you would be required to submit your assignments ON or BEFORE the
due date set on your assignment (before 11h55 PM). After the date has passed (i.e. 12h00AM of the
next day) the assignment submission will be disabled, and you would no longer be able to submit
your assignment. Please note that assignment submissions will be open long before the due dates.
Please note that your assignment due dates are on page 2 of this Tutorial Letter. Use this assignment
due dates to set up your calendar tool on your mobile phone or computer to set reminders for yourself
and manage your time. Another way to keep pace with due dates, is by regularly visiting your Timeline
of each of your courses on Moodle on the Course Overview. Also download the Moodle mobile app to
access Moodle on your mobile phone or tablet and have access to notifications about due dates at your
fingertips from Google Play Store for Android or Apple App Store for IOS.
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
5. Submission of Assignments
Due to challenges with Internet connectivity and speed, large files may take too long to upload, which
is a big risk if you wait until the last minute to submit your assignments. You are therefore strongly
advised NOT to wait until the final hours of the due dates to submit your assignments to avoid
disappointments. You are also advised to ensure that you are in an area with good Internet connectivity
when submitting your assignments. Timely submission of all assignments on or before the given due
date is crucial for the timely grading and processing of your CA marks and determining admission to
exams.
Take note that assignments should never be submitted directly by email or hard copy to
individual tutors or any other staff members of the University of Namibia.
6.
Medical and death are the only reasons accepted for the late submission of assignments.
Late submission of assignments will only be approved 7 days (including public holidays and
weekends) after the due date of an assignment. Valid documentary proof must be attached as part of
the assignment before any late submission will be considered. Late submission without valid
documentary proof attached to the assignment will be returned unmarked and may not be resubmitted
for marking. Travelling and attendance of workshops, job related activities and conferences may
not be used as an excuse for the late submission of assignments. All late submission request must be
forwarded to the Student support coordinator for approval.
7. Academic Support
One every Moodle course there is an embedded Academic Support section with materials to assist you
with your writing process (see Figure 3 below). Go through the videos in order to enhance your writing
process and submit better quality assignments.
Figure 3: Academic Support tutorials
8. Grace Period
A grace period refers to three (3) additional days added after your assignment due
date. The purpose of this grace period is to provide each student with time to verify
and or to make amendments to assignments already submitted. These changes may
include correcting errors like submitting a file to a wrong module or on a wrong
assignment; submitting a wrong file; losing internet connectivity, etc. An example
would be that a student attempting to submit an assignment and they lose internet
connection would still be able to try again the day after at a different place or when the
connection has been restored.
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
9. Plagiarism Control
It has been observed that some students copy information from the Internet and paste
into their assignments without acknowledging the sources of the information. This is
called plagiarism. A copy of the Policy on Academic Integrity has been provided to you
on every course on Moodle. Please note that plagiarism which includes copying and
pasting information from the Internet would not be tolerated, shall result in your
assignments declared null and void and graded as a “0”. All assignments submitted
through Moodle would be checked for plagiarism using plagiarism detection software.
You are therefore strongly urged to acknowledge EVERY source that you use for your
assignment by using the appropriate citations and references following the referencing
style prescribed by your lecturers (APA Referencing guides are available freely
online). Find one here: http://www.uofa.edu/docs/apa-documentation.pdf
Any assignment found with high similarity scores or with evidence of clear attempts to
cheat such as submitting an assignment that is not your own would result in a zero (0)
grade.
10. Vacation schools
Attending vacation school is COMPULSORY and the vacation school timetable will be made
available through the UNAM Moodle
11. My UNAM Portal and Moodle
We recommend that you regularly (at least twice a week) access your “My UNAM
Portal” (http://my.unam.edu.na) for your registration status and information, and
Moodle (https://elearning.unam.edu.na ) for your learning and assessment
information.
Also visit the Distance Education Common Space on Moodle where you can find all
necessary information and user manuals related to your distance mode studies and
also engage with other students studying on distance mode. See additional
information under Section 11 below.
12. Online Support (Ticketing) System
An online support system is provided where you can report some of the issues that you may experience
regarding your studies. This system is easily accessible from the Moodle LMS system.
Figure 4: Online ticketing system
You can also make use of the Online Support (Ticketing System) for queries to be responded to by
the responsible person within 48 hours. We recommend you use this system for Help Topics or issues
listed on the system rather than email or telephone calls.
13. Online information, Tutorials and Distance Education Common Space
Information and Tutorials are provided in each course on the Moodle Learning
Management System which you should first familiarise yourself once you first access
your courses.
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
Figure 5: Info-Tutorials on Moodle
Indicated in Figure 4 above, the Distance Student Orientation provides video tutorials on various
activities you would perform such as submitting your assignments, converting your documents into pdf
format, changing your email address, how to check your results when assignments have been graded
and so on.
Updates and information with regard to your studies and related events would be shared in the Distance
Education Common Space which you can access from any course as shown in screenshot below. All
students studying on distance mode are linked this the space where you can collaborate or discuss
general issues.
Figure 6: Distance Education Common Space
You will also find the Student Information Letter, your Vacation School Timetable and User Guides in
the Distance Education Common Space.
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
14. Staff Contact Information
If you study conscientiously, your efforts will be rewarded. Should you need any assistance or
clarification on the module contents, you can reach the relevant staff members at the contact details as
given below:
Tutor:
For Module/Subject content related matters,
Assignments marks and CA marks queries
TBA
Student Support Coordinator:
Assignment due dates, Availability of assignments,
Unmarked assignments, Vacation schools
Ms. Anna-Marie Murere
0612063729
amurere@unam.na
Faculty officers:
Ms Nelago
0612063987
onelago@unam.na
Admissions
Ms T Nuuyoma
0612063609
tnuuyoma@unam.na
Registration
Ms G Van Wyk
0612063084
gvanwyk@unam.na
Appeals
Ms. A Nelumbu (SP)
063 220 2039
anelumbu@unam.na
Addition of Modules
Ms. S Shapumba (HP)
064 502 6508
sshapumba@unam.na
Cancellations of Modules
Mr. I Mundumbu (RP)
066 268 6078
imundumbu@unam.na
Graduation
Ms. R Chata (KP)
066 262 6071
nchata@unam.na
Ms A Felix (PO)
065- 2323042
afelix@unam.na
Examination Officers:
Desley Goses (WHK)
061-2064881
dgoses@unam.na
For Exam marks and exam timetable, exam
related matters
Stephanie Nehoja (WHK)
061-2063715
snehoja@unam.na
eLearning Administrator:
Mr Owen Lisulo
0612063381
olisulo@unam.na
Moodle related queries (technical problems),
linking of Modules, etc.
Mr Shaka Maikhudumu
0612063000
smaikhudumu@unam.na
061 2063014
061 2063041
itsupport@unam.na
Please create an online ticket for any assistance
Log In/Passwords To reset passwords & for
Logging onto Moodle and Portal
All exam officers at respective
campuses assist students of those
campuses
https://elearning.unam.edu.na/sup
port/open.php
Computer Centre/ IT Helpdesk
Team
NOTE: For additional information consult the Prospectus and UNAM General Information and
Regulations Prospectus.
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
Serious offence not tolerated at all
Note well: Plagiarism
Plagiarism is “the wrongful appropriation or purloining, and publication as one’s own, of the ideas, or the
expression of the ideas of another” (OED). All published and unpublished material, whether in manuscript, printed
or electronic form, is covered under this description.
The Proctors’ Disciplinary Regulations concerning conduct in examinations (see Part 19.4. and 19.5, p. 52) state
that ‘No candidate shall present for an examination as his or her own work any part of the substance of another
person’s work. In any written work (whether thesis, dissertation, essay, coursework, or written examination, or
assignment) passages quoted or closely paraphrased from another person’s work must be identified as quotations
or paraphrases, and the source of the quoted or paraphrased material must be clearly acknowledged.’ In all written
work students must be vigilant in citing the work they have referred to or quoted from (please see further Appendix
D).
Examples
of
plagiarism
and
detailed
advice
as
to
how
to
avoid
it
are
given
on
http://www.admin.ox.ac.uk/edc/goodpractice/: you are strongly advised to consult this website.
It has been observed that some students merely download information from the Internet, copy verbatim from other
printed sources (including the Study Guide, employ other people to do their assignments for them, or plagiarise
each other’s assignments (either directly, that is, word-to-word, or through a re-arrangement of words or
paragraphs in order to deceive the tutor or marker).
These practices constitute very serious academic offences of academic dishonesty, alternatively, intellectual fraud,
which attract very serious and heavy penalties. Students must desist from such practices. Such students may score
very high marks but invariably perform very poorly in examinations. It is in the interest of such students to
endeavour to exercise their own intellectual faculties, do their own research, and personally do the set assignments.
No hardcopies are allowed, all assignment are to be uploaded through Moodle.
✓ Assignments should be submitted in PDF – only. Kindly save your assignments in PDF format
✓ Make sure that you submit one assignment as one file/document. Do not create and upload
several folders; do not zip the documents. Have 1 one document/file for 1 (ONE) entire
assignment.
✓ Assignments for modules with formulas can be handwritten, scanned in one document and
uploaded on Moodle accordingly.
✓ Make sure you submit a document that is readable and virus free.
✓ Make sure you upload the right file with the relevant assignment content.
✓ After submitting your assignment on Moodle do verify on the file you uploaded. Always try
to submit your assignment few days before the due date, this allows you to double-check
all the nitty-gritties.
NO LATE SUBMISSIONS WILL BE TOLERATED. NO LATE submission due to not adhering to the
above advises or guidance WILL BE ACCEPTED nor ENTERTAINED.
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
Faculty
Commerce, Management & Law
School
School of Accounting
Subject
Financial Accounting 2A
Subject Code
CAFE 3781
Assessment type Part-time Assignment 1
Marks
100
ASSIGNMENT 1 (2024)
L. Shinkeva
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
Question 1
35 Marks
Nuyoma Motors, is a car dealership that sells, repairs and services passenger vehicles. The
company has a 31 December year-end. During the year ended 31 December 2023 the
following contracts in terms of IFRS 15, Revenue from Contracts with Customers, were
identified by the accountant who was unsure about the accounting treatment thereof. Ignore
VAT.
Contract 1:
Nuyoma Motors entered into a contract with a customer to sell a Polo GTI vehicle with a 3year service plan for a total price of N$437 000. The contract contains two performance
obligations, for which the stand-alone selling prices are as follows:
•
•
Supply and delivery of vehicle
3-year annual service
N$460 000
N$17 250
The vehicle was delivered on 10 January 2023 upon receipt of full payment. The first annual
service was performed on 31 December 2023. Financing on the 3-year annual service is
considered insignificant.
Contract 2:
Nuyoma Motors successfully tendered for a government contract to supply 10 Landcruiser
bakkies to the Ministry of Environment and Tourism for the anti-poaching program. The
terms of the agreement are as follows:
•
•
The contract includes a service-type warranty wherein if a vehicle is found to be
defective within 12-months of purchase, it may be returned for a full refund. This 1year warranty is offered at an extra charge of N$23 000 per vehicle.
The total selling price per vehicle including the warranty is N$600 000. 50% of the
price was paid upon delivery on 1 January 2023 and the remaining balance to be
paid on 31 December 2024.
Assume an appropriate discount rate of 7%.
No vehicle was returned by 31 December 2023.
Required
a) Explain the five steps of revenue recognition model as per IFRS 15, Revenue from
contracts with customers. (20)
b) Provide the 2023 journal entries to account for the contracts in the books of Nuyoma
Motors. Journal narrations are not required. Clearly show all workings. (15)
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
Question 2
25 Marks
Delush Limited, a wine manufacturing company, has a 31 December financial year end. The
following information is relevant for the year ended 31 December 2023:
Raw materials balance at 1 January 2023 (100 bags)
N$220 000
Finished goods balance (40 barrels) at 1 January 2023
N$140 000
Invoice price of raw materials purchased (see note 1 below)
N$3 630 000
Refundable import duties
N$187 000
Direct labour
N$900 000
Variable manufacturing costs
N$1 510 000
Fixed manufacturing overheads
N$1 200 000
Note 1: Raw materials (1 200 bags) were purchased on 1 January 2023 from a supplier who
granted settlement terms of 24 months to Delush Ltd (payment is due on
31 December 2024). The time value of money is considered material, and an appropriate
market interest rate is 10% per annum.
One bag of raw materials produces a barrel of wine. 1 400 barrels of wine were
manufactured during the year. The budget indicated that normal production would be 1 500
barrels. 1 300 barrels were sold during the year.
Closing stock at 31 December 2023 was:
Raw materials (100 bags)
Work in progress
Finished goods (140 barrels)
N$???
N$ Nil
N$??
Delush Ltd makes use of the first-in-first-out (FIFO) method for all classes of inventory.
The current sales price of finished goods is N$4 900 per barrel and selling costs amount to
N$120 per barrel. The selling price is expected to be decreased by 5% due to an entrant of a
new competitor and all costs are expected to increase by 7% in the next year due to
inflation.
REQUIRED:
a) Explain the accounting treatment of by products in accordance with IAS 2
(Inventories). (3)
b) Prepare the following notes in accordance with the International Financial Reporting
Standards (IFRS) to be presented in the financial statements of Delush Limited for
the year ended 31 December 2022:
I.
Profit before tax (2)
II.
Inventory (20)
Round to the nearest N$.
Clearly show all your workings including the ledgers.
Comparatives is not required
Ignore VAT
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
Question 3
20 Marks
Oak Timber Ltd (‘Oak’) is a large company listed on the Johannesburg Stock Exchange. Oak
has a 30 June financial year end and early adopted all applicable accounting standards since
they became available. Oak operates in the forestry sector and operates a sawmill and a
plywood plant as well as warehouses and distribution facilities. Plant and machinery are
accounted for on the cost model in terms of IAS 16 and are depreciated over their useful lives
on the straight-line method.
Below you will find some information with regards to the assets and liabilities of Oak:
1. Inventory
The following inventory information is available for the financial year ended 30 June 2022:
Raw material balance on 30 June 2022
Raw material issued to the production process
Work-in-progress balance at 1 July 2021
Direct labour costs
Variable overhead costs
Fixed overhead costs (Note A)
Goods completed during the 2022 financial year (Note B)
Finished goods balance on 30 June 2022 (Note B)
Cost (N$)
250 000
400 000
140 000
600 000
50 000
?
1 200 000
345 000
Note A:
• The only fixed overhead costs incurred relates to the depreciation of the machinery as
listed in the asset register below (section 2). Actual production for the year was
200 000kg.
Note B:
• There was no opening balance for finished goods.
• Normal production capacity is 250 000 kg of finished goods per year.
• Oak adds 20% to the cost of goods to determine the selling price. The estimated selling
price of the finished goods on hand at the end of the year, will be 20% less than the
normal sales price due to economic factors. The cost to sell the finished goods is N$nil.
• The net realisable value of raw materials and the work-in-progress was found to be
higher than the cost price at the beginning and end of the year.
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
2. Asset Register
Sawmill
The first stage of preparing timber for commercial use is tree felling. A forestry worker will
determine when and which trees should be cut down, depending on when they reach their
economically mature stages.
Stage two involves the transport and storage of the logs to the sawmill. The trees are usually
cut into smaller lengths on-site and then picked up by a timber truck, which transports the
timber to the sawmill.
After arriving at the sawmill, stage three of the process commences. Trees are debarked and
cut into the required lengths. Then they are cut into boards, using a circular saw. The sawing
process also consists of two stages; the first stage is rough sawing and the second stage is
called ‘re-sawing’ and refers to more precise cutting and finishing.
Stage four is where seasoning of the natural wood takes place. This is the process of removing
excess moisture content from the wood. Finally, the wood is treated against rot and fire and is
now in its completed form as either structural or industrial timber. The two types, i.e. structural
or industrial timber, are distinguished only by thickness and length.
Plywood plant
The sawmill supervisor selects timber that meet the requirements and send it to the plywood
plant. Plywood is made of three or more thin layers of wood bonded together with an adhesive.
Most plywood is pressed into large, flat sheets used in building construction. Other plywood
pieces may be formed into simple or compound curves for use in furniture, boats, and aircraft.
Below is a summary of the asset register with regards to the sawmill and the plywood plant:
Asset
no
1 – 10
11 – 20
Asset description
Note
no
Industrial round saws
Handheld
round
saws
21
Debarking machine
22
Plywood press
*All amounts have been correctly
account.
•
1
2
Asset
class
Machinery
Machinery
Total
useful
life in
years
Note 1
3
Carrying
Carrying
amount at
amount at
30 June 2021 30 June 2022
N$1 230 000*
N$350 000*
N$750 000*
N$275 000*
3
Machinery
8
N$633 000*
N$551 177*
4
Machinery
10
N$530 000*
?
calculated after taking all relevant information into
Note 1: The industrial round saws (‘industrial saws’) consist of two components each (the
industrial saw itself and component X), which is recognised as separate components. The
industrial saw is depreciated over ten years and component X is depreciated over three
years. The residual value of the industrial saws as well as component X are considered
to be insignificant.
On 30 June 2022, component X of five industrial saws were replaced when the carrying
amount of these components amounted to N$ 55 000 (in total for all five components).
The components were sent to a scrapyard and N$ 1 000 was received for all five
components in total. This came as a surprise since it does not usually happen that
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
scrapyards pay for these types of components. The total cost (paid for in cash) to replace
component X of the five industrial saws, amounted to N$ 150 000.
No industrial saws were purchased or sold during the 2022 financial year.
The useful lives and residual value estimates of the saws and component X remained
unchanged.
•
Note 2: Two of the handheld round saws (‘handheld saws’) were sold for N$ 25 000 (in
total), resulting in a profit with the sale of N$ 5 000 (in total). No replacement handheld
saws were purchased.
•
Note 3: The debarking machine had to undergo an inspection on 1 May 2022. The cost
of the inspection amounted to N$ 60 000 (the machine needs to be inspected every two
years). Inspection costs were initially not accounted for as a separate component. The
previous inspection (which was also the first) took place on 1 June 2020 at a cost of
N$55 000 when the remaining useful life of the machine was eight years.
•
Note 4: The plywood press was estimated to have a useful life of ten years when
purchased on 31 August 2018, however on 30 June 2022 it was estimated that the press
only has a remaining useful life of five years from this date. The residual value is
considered to be insignificant.
Please Ignore VAT.
Required
Prepare the following notes to be disclosed in the financial statements of Oak for the financial
year ended 30 June 2022 as far as it relates to the information provided:
• Inventory note
(15)
• Profit before tax note
(5)
Comparative figures, sub-totals and totals are not required. Please show all your workings
clearly.
Question 4
20 Marks
Timber Kings Ltd (‘Timber Kings’) is a company that manufactures and distributes high end
custom-made timber furniture. Timber Kings is a registered VAT vendor and has a financial
reporting date of 31 December. The following details relates to assets owned by Timber Kings:
Plant
Timber Kings purchased a manufacturing plant on 1 January 2023 at a cost of N$3,220,000
(VAT inclusive). The manufacturing plant was tested at a cost of N$120,000 and the samples
manufactured during testing were sold for N$80,000. The plant was available for use on 1
March 2023.Timber Kings is required to dismantle the plant and restore the site at the end of
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
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the plant’s useful life. It is estimated that it will cost N$750,000 to restore and dismantle the
machine at the end of year 15. Timber Kings spent N$250,000 on advertising the product to
be manufactured by the plant. Due to initial operating inefficiencies, a total loss of N$150,000
was incurred in the first year of operation.
Land
Timber Kings owns land which was acquired on 2 January 2019 for N$3 220 000.Timber
Kings also paid N$490 000 transfer duty to to acquire the land. Additional N$1 265 000 (VAT
inclusive) was incurred to service the land before any construction could take place and was
complete on 1 April 2019.
Office buildings
Various office buildings were erected on the acquired piece of land. The total costs incurred
to erect the office buildings amounted to N$13 570 000 (VAT inclusive). Construction of all the
office buildings were completed on 30 June 2020. The office buildings were ready for use on
this date. The staff moved into the office buildings during the first week of January 2021. The
total useful life of the office buildings was initially estimated to be 20 years with no residual
value. The useful life and residual value estimate remained unchanged to date.
The office buildings were revalued for the first time to its fair value of N$12 000 000 on
31 December 2022 and subsequently to a fair value of N$13 150 000 on 31 December 2023.
Accounting policies and other information
•
•
•
•
•
•
•
•
The plant and office buildings is accounted for using the revaluation model in terms of
IAS 16 Property, Plant and Equipment, and are revalued at the end of the financial year
using the gross replacement value method.
Land is accounted for under the cost model in terms of IAS 16 Property, Plant and
Equipment.
Timber Kings use the straight-line method to depreciate all Property, Plant and Equipment.
Any revaluation surplus is regarded to realise over the remaining useful life of the
underlying asset as the asset is being used.
Assume that all amounts exclude 15% VAT except if stated otherwise.
Assume that the normal credit terms are 30 days for all years under consideration.
Assume an after tax discount rate of 6.8% per annum (compounded annually) as
appropriate for all years under consideration.
Assume a normal tax rate of 32%.
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
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REQUIRED:
(a) Calculate the initial cost of the manufacturing plant to be recognised in the
financial statements of Timber Kings Ltd.
MARKS
Sub
total
6
(b) Prepare an extract of the property, plant and equipment note to be disclosed
in the financial statements of Timber Kings Ltd for the financial year ended
31 December 2023. Only include the following classes of assets as part of
the note:
•
•
13
Land; and
Office buildings.
Accounting policy notes, a total column and comparative figures are not
required. Additional descriptions as part of disclosure notes are not required.
Communication skills – presentation and layout
Total marks
1
20
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
Faculty
Commerce, Management & Law
School
School of Accounting
Subject
Financial Accounting 2A
Subject Code
CAFE 3781
Assessment type Part-time Assignment 2
Marks
100
ASSIGNMENT 2 (2024)
L. Shinkeva
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
Question 1
10 Marks
Shinyungwe Limited is a fast-growing shoe manufacturing company that was inspired by the
international success of the well renowned sprinter, Christine Mboma. Shinyungwe Limited
commenced with the process of listing on the Namibian Stock Exchange (NSX) to raise capital
for the business expansion.
Shinyungwe Limited developed the Mboma brand of running shoes. The brand was legally
registered upon development and has gained increasing popularity among runners in Africa
and Europe. Shinyungwe Limited launched the Mboma brand during 2022 and the success of
the brand has seen substantial growth in the company profits. An independent sportswear
valuator determined the fair value of the Mboma brand to be N$75 million at 31 December
2023.
The CEO of Shinyingwe Limited has proposed for the recognition of the brand in the 31
December 2023 financial statements as it will improve the financial position of the company
and boost investor interest.
Required:
Discuss whether the accounting treatment for the Mboma brand proposed by the CEO is in
accordance with International Financial Reporting Standards. (10)
Question 2
35 Marks
Vuka Africa (Pty) Ltd specializes in the printing and distribution of books on African literature
and philosophy. The newly appointed financial and management accountant has been
struggling with the company’s new inventory costing strategy, applied from 1 July 2022.
The following monthly information has been provided:
Description
Factory rent
Raw materials (per unit)
Factory supervisor’s salary
Debtor’s clerk’s salary
Total
Amount - N$
35 000
800
90 000
65 000
190 800
Normal production capacity is 4 500 books per month, however 5 000 books were produced
in 2023.
Vuka Africa owns the plant and machinery required for printing of the above books. As a result
of new technology in the printing industry, Vuka Africa now expects to earn less revenue from
its plant and machinery. The plant and machinery were acquired on 1 July 2020 and is
depreciated using straight-line method over 8 years. The carrying amounts of the plant and
machinery on 30 June 2023 were as follows:
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FACULTY OF COMMERCE, MANAGEMENT AND LAW
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Description
Plant
Machinery
Amount - N$
1 700 000
1 500 000
Management determined the fair value less costs of disposal of the plant to be N$ 1 650 000
and that of machinery to be N$ 1 340 000 on 30 June 2023.
Vuka Africais of the opinion that the plant will generate net cash inflows of N$ 450 000 per
annum over the next five years and this was confirmed in the most recent cash flow budget of
management. The plant can be disposed of for a net amount of N$ 30 000 at the end of its
useful life.
The budgeted net cash inflows for the next five years from the machinery (that occur at the
end of each year), are as follows:
Year
2024
2025
2026
2027
2028
Amount - N$
380 000
390 000
410 000
400 000
360 000
An appropriate pre-tax discount rate is 10%.
Ignore VAT.
Required
a)
Calculate the fixed overhead allocation rate per unit for 2023 financial year. (4)
b)
Indicate clearly which of the following costs should be included in the cost of
inventory: (6)
i.
ii.
iii.
iv.
v.
vi.
Impairment losses on machinery and equipment used in manufacturing process.
Costs to design a product for a specific customer.
Packaging costs incurred to prepare inventory for sale.
Selling costs.
Amortisation of development costs relating to a specific product.
Raw materials spillage.
c)
Calculate the impairment loss to be recognised by Vuka Africa for the year ended 30
June 2023, in accordance with the requirements of IFRS. (15)
d)
Prepare journal entries to record above impairment losses where applicable. Journal
narrations are not required. (2)
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e)
Discuss the sources of information that can be used in assessing whether an asset is
impaired in accordance with IFRS 36, Impairment of Assets. These sources of
information are also known as Indicators of Impairment. (8)
Question 3
25 Marks
The following are the abridged financial statements of Moon Ltd (“Moon”) and its subsidiary
Yodo Ltd (“Yodo”) as at 31 December 2023:
Assets
Property Plant and Equipment
Investment in Yodo Ltd at cost price (360 000
shares)
Investment in First rand Ltd Shares
12% Debentures (15 000 debentures of N$ 5 each
in Investec Ltd)
Inventories
Trade receivables
Other current assets
Cash and cash equivalents
Equity and liabilities
Share capital (800 000 shares Moon and 400 000
shares Yodo)
General reserve
Retained earnings
Moon
N$
Yodo
N$
330 000
450 000
287 500
10 000
75 000
80 000
108 500
35 000
150 000
120 000
175 500
62 000
-
645 000
360 000
59 000
413 000
128 250
Liabilities
Long-term loan
82 500
Trade payables
Other current liabilities
Bank overdraft
120 000
1 500
-
35 000
9 250
30 000
Additional information:
1.
Moon Ltd acquired the ordinary shares of Yodo Ltd on 1 January 2023 when the retained
earnings was N$95,000. Moon Ltd paid for the investment at acquisition date via a bank
transfer.
2.
On the date of acquisition of the interest, Moon Ltd was satisfied that the assets and
liabilities of Yodo Ltd were fairly valued.
3.
It is the entity's policy to measure any non-controlling interests in an acquiree at their
proportionate share of the acquiree's identifiable net assets.
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Required
a)
Prepare the at acquisition date pro-forma journal entries for the 2023 group financial
statements. Journal narrations are not required.
(6)
b)
Prepare a Statement of Financial Position as at 31 December 2023 for the group in
accordance with IFRS. Notes and comparative figures are not required. One (1) mark
will be allocated for Presentation Skills.
(15)
c)
Prepare all the pro-forma consolidation journal entries to incorporate Yodo Ltd into the
Moon Ltd group for the year ended 31 December 2023 assuming that management rather
choose to use the fair value method to value non-controlling interest. The fair value of
the non-controlling interest of Yodo at acquisition amounted to N$ 42 000, applicable to
part (c) only. Furthermore, assume that the total consideration paid for the shares in Yodo
Ltd was N$ 400 000. Journal narrations are not required.
(4)
Question 4
30 Marks
You are the financial director of Dawn Ltd (“Dawn”), the parent company of the Dawn group.
All companies within the group’s reporting date is 31 December.
Extract of the trial balances as at 31 December 2023 of the group’s companies listed below:
Share capital, at N$ 68 for each share
Share capital, at N$ 70 for each share
Retained earnings, 1 January 2023
General reserve
Investment in 3 000 000 shares of Horizon at cost
Property, plant and equipment
Other investments
Inventory
Accounts receivable
Bank
Accounts payable
Long term liabilities
Revenue
Cost of sales
Expenses
Income tax expense
Profit before tax for the year
24
Dawn Ltd
N$
(680 000 000)
Horizon Ltd
N$
(7 300 000)
(24 500 000)
210 000 000
207 900 000
104 500 000
154 000 000
150 000 000
(10 000 000)
(41 000 000)
(44 400 000)
???
300 000 000
71 750 000
(350 000 000)
(2 100 000)
(15 000 000)
126 500 000
14 000 000
160 000 000
155 000 000
7 500 000
(15 500 000)
(74 000 000)
(230 000 000)
???
48 100 000
9 050 000
(28 250 000)
3 000 000
(9 400 000)
FACULTY OF COMMERCE, MANAGEMENT AND LAW
OLD CURRICULUM MODULES
Extract of Retained Earnings in the statement of changes in equity for the year ending
31 December 2023 of the group’s companies listed below:
Dawn Ltd
Retained
Earnings
N$
7 300 000
19 200 000
(4 500 000)
(12 000 000)
10 000 000
Balance - 1 January 2023
Profit for the year
Transfer to general reserve
Dividends declared
Balance - 31 December 2023
Horizon Ltd
Retained
Earnings
N$
2 100 000
6 400 000
(2 500 000)
6 000 000
Additional Information
•
•
•
•
•
•
Dawn acquired its shareholding in Horizon Ltd (“Horizon”) on 30 June 2020 when the
general reserve and the retained earnings were N$2 000 000 and N$1 500 000
respectively.
Assume that the identifiable assets and liabilities acquired at acquisition date are shown
at their acquisition-date fair values, as determined in terms of IFRS 3, Business
combinations. Dawn elected to measure any non-controlling interests in Horizon at its
proportional share of Horizon’s identifiable net assets at acquisition date.
Dawn classifies the equity investments in Horizon at cost in accordance with IFRS 9,
Financial instruments.
Revenue is calculated on a gross profit percentage of 25%.
Expenses includes:
o Depreciation on the property, plant and equipment which is calculated using the
10% per year diminishing value method. Depreciation is classified as an
administrative expense.
o Finance costs on the long term loans of N$ 4 440 000 and N$ 5 920 000 for the
parent and subsidiary respectively.
o The remaining costs are other expenses.
You should use the income tax figures indicated above and don’t have to recalculate the
income tax expense.
Required
a)
Prepare all the pro-forma consolidation journal entries to incorporate Horizon (Pty) Ltd
into the Dawn Ltd group for the year ended 31 December 2023. Journal narrations are
not required.
(15)
b)
Prepare a Statement of profit or loss and other comprehensive income for the year ended
31 December 2023 of the Dawn group in accordance with IFRS. One (1) mark will be
allocated for Presentation Skill. Notes and comparative figures are not required. The
revenue, cost of sales, gross profit and different income and various expense items needs
to be clearly indicated on the Statement of profit or loss and other comprehensive income
for the year.
(15)
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