Solutions to Summative Assessment 2 from the accompanying textbook NCV 2 Mathematical Literacy Hands-On Training published by Future Managers Pty Ltd (www.futuremanagers.net)

1. Mathematical Literacy 2
Module 2
Answers to Assessment Questions
Mathematical Literacy Future Managers 1

2. Self Assessment Pg 56
1. Francois, who lives on his own in a rented room, wrote down
in a note book the following amounts that passed through his
hands during the month of August:
Food bought at the local grocer each weekend to the total of R800,00 for
the whole month; room rental of R750,00 paid; clothes bought to the value
of R500,00; cell phone air time of R220,00; daily taxi fair to and from work
at R7,00 per day; other occasional travelling expenses R50,00; lunches
every working day costs him R25,00; he buys four R5,00 lotto tickets each
Saturday; he goes to the pub every Saturday and drinks two quarts of beer,
which he buys at R7,00 per quart; he smokes 20 cigarettes per day but has
not calculated what this costs him; he receives a salary of R4000,00 per
month from which 1% UIF is deducted. Tax is subtracted every month at
the rate of 18%.
Mathematical Literacy Future Managers 2

3. a. Organise Francois’s money matters for him neatly into a table
separating Income and Expenses
Monthly Income: Amount Fixed Variable
Salary 4000,00 √
Subtraction (UIF at 1%; Tax: 18%) 760,00 √
Net Income 3240,00
Monthly Expenses:
Food 800,00 √
Room rental 750,00 √
Clothes 500,00 √
Cell phone 220,00 √
Travel costs 190,00 √ √
Lunches 500,00 √
Lotto 80,00 √
Beer 56,00 √
Cigarettes 476,00 √
Total Expenses: 3572,00
Income after Expenses: -332,00
Mathematical Literacy Future Managers 3

4. • Calculate his net income i.e. after deductions.
Francois earns R4000 per month. He pays
18% tax and 1% UIF. Tax = R4000 x 0.18 =
R720; UIF = R40
Total deductions = R760
Net income = R3 240
• Calculate the amount he has left after all his
expenses have been subtracted from his net
income.
Income after expenses = R3240 - R3572 = - R388
Mathematical Literacy Future Managers 4

5. a. Advise him on actions to take with regard to a safe
financial future. For example, advise him on how to
save and why he should save.
Francois should think about the fact that he is smoking
to the value of R5712 per year. His annual cell phone
costs are also high at R2640.
Lotto for the year comes to almost R1000. These three
items add up to the value of two months’ salaries. He
should contemplate whether it would not be better for
him in the long run to save this money as there will
come a time when he will have medical expenses as well
as other responsibilities.
Mathematical Literacy Future Managers 5

6. 1. Rosie is a single mother of one child, whose name is Lily.
Rosie and Lily live in a rented flat. She has the following
expenses per month
Expense Item Fixed or Var Amount % of Income
Rental amount of room x 650
Crèche fees for Lily x 350
Food x 950
Taxi fare x 300
Telephone x 180
Entertainment x 100
Money saved x 250
Clothes x 150
Lotto x 80
Cigarettes x 100
Total (a) R3110
Mathematical Literacy Future Managers 6

7. • She earns R800 per week (four times per
month), and receives maintenance money of
R150 each month from Lily’s father. Calculate
her monthly income
Rosie’s Income = Salary + Maintenance
= R800 x 4 +R150
= R3 350
Mathematical Literacy Future Managers 7

8. Expense Item Fixed or Var Amount % of Income
Rental amount of room x 650 19,4
Crèche fees for Lily x 350 10,4
Food x 950 28,4
Taxi fare x 300 9,0
Telephone x 180 5,4
Entertainment x 100 3,0
Money saved x 250 7,5
Clothes x 150 4,5
Lotto x 80 2,4
Cigarettes x 100 3,0
Total (a) R3110
Mathematical Literacy Future Managers 8

9. Rosie's Expenditure
Cigarettes
Lotto
3%
3%
Clothes Rental
5% 21%
Money saved
8%
Entertainment
3%
Phone
6% Creche
11%
Taxi
10%
Food
30%
Mathematical Literacy Future Managers 9

10. `
• Calculate how much money Rosie has left after
deducting all her expenses for the month.
Money remaining = Total income – Total expenditure
= R3 350 – R3 110
= R240
• What would you advise Rosie to do with any
remaining money?
Rosie should put any extra money in a savings
account as she has not budgeted for clothes,
medical expense and any other possible
unforeseen expenses.
Mathematical Literacy Future Managers 10

11. Self Assessment Pg 61
From the income statement of Francois’s parents. a budget can be
compiled given their expected fixed income of R7 550 per month
Expense Budget % Expense April Exp Variance Var %
Rent 2050 27,15 2050 0 0
Insurance 400 5,29 400 0 0
W+E 265 3,51 300 +35 +13,2%
Phone 480 6,3 500 +20 +4,2%
Transport 300 3,97 350 +50 +16,7%
School 265 3,5 265 0 0
Clothes 250 3,3 100 -150 -60%
Medical 146 1,93 200 +54 +37%
Food 2850 37,72 3500 +650 +52,6
Savings 250 3,3 200 -50 -20%
Entertain 300 3,97 (c)R0 -300 -100%
Total (a) R7556 100 (b) R7865
Mathematical Literacy Future Managers 11

12. Summative Assessment
TV Licences Private Bag x 60
Mr. Benni Mokoena Auckland Park 2006
License renewal period:
Walter Sisulu Drive
2008/08/01-2009/07/31
Boshabelo
Bloemfontein
Closing balance: 25,80
Date: Particulars: Amount: 225,00
2007/07/20 Private Household Balance due: 250,80
120+ days 90 days 60 days 30 days Current Balance
25,80 225,80 250,80
Mathematical Literacy Future Managers 12

13. Summative Assessment
On the previous slide is Benni Mokoena’s TV license that
he had to buy when he bought his TV.
2. Answer the questions below
3. Complete a direct deposit slip from a bank to clear the
account
Questions:
5. What does “closing balance” mean?
The balance at the end of the period
8. What does “120 days or more” mean?
It means debt that is over 120 days old
Mathematical Literacy Future Managers 13

14. • What is the total amount you have to pay?
It means debt that is over 120 days old
• What is the due date of payment?
20 July 2007
Mathematical Literacy Future Managers 14

15. a. In fine print beneath the account is typed: A
fine of 10% per month is levied on late
payments. How much will your balance be if
you are one month late?
R25,08
d. What type of expense is a TV license – fixed
or variable?
Fixed
Mathematical Literacy Future Managers 15

16. 1. From Wonder Bank’s table of banking costs –
Calculate the following:
a. Withdrawal over the counter of R250
R17,50 + 250 x 0.009=R19.75
c. ATM Cash withdrawal of R1 050 at a
SASWITCH terminal
R12,65???
e. Monthly administration fee
R2,00???
g. ATM cash withdrawal of R850 at own
bank’s ATM
R3,10 + R350 x 0.009 = R6,25
Mathematical Literacy Future Managers 16

17. 08 05 23
B Mokoena 250 80
250 80
Benni Mokoena
B Mokoena
Mathematical Literacy Future Managers 17