Economics and Management Sciences: EMS Grade 7 Term 2 Test with Answers:
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Read the case study carefully and answer questions that follow.
1. Answer all questions
2. This is an individual work
3. The total mark for the casestudy is thirty(30)marks.
Read the case study and answer the questions that follow.
Tendani’s Hair Salon
When Tendani started his new hair salon, it cost him R25 000 to set up his business. He had savings of R10 000 and borrowed R15 000 from the bank. The money was used to buy a kiosk, furniture, hair equipment and hair products. He has a worker that helps him with some of the male haircuts. He pays his worker a salary of R2 000 per month. His other expenses include water and electricity,R650 and hair products, R1 000.
The hair salon generates an income of approximately R12 000 a month. Tendani has opened a savings account for the business of R6 000 and earns 5% interest on the savings account every month.
Tendani is not happy with the work ethics of his worker. He takes long lunch hours and customers have to wait for him. Often he stands around in the hair salon not doing anything when he could be cleaning. The worker also wastes water by leaving taps unattended and leaves the air conditioning on after hours. Tendani pays himself a salary of R5 000 a month.
- What type of business is Tendani running? (1)
- How much capital did Tendani contribute towards his business? (1)
- Identify three assets of the business. (3)
- Explain two reasons that can cause the profit of the business to decrease.(2)
- Mention any two of the owner’s personal expenses. (2)
- If the owner saves R500 a month, how much money would he have saved in a year’s time?
Use the information given in the case study to do the following:
- Draw Tendani’s statement of net worth for the month. (9)
- Calculate the profit or loss of the business. (2)
- How much interest would he earn from his savings? (2)
- Classify the accounts under the following headings:
5. Differentiate between personal income and business income.
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