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Worksheets

Interest

Total questions: 11

Worksheet time: 22mins

Name
Class
Date
1.

What does Section 24J apply to?


a)

Any financial transaction


b)

Interest-bearing arrangements or debt instruments

c)

Non-interest-bearing loans

d)

Any income-generating activities

2.

What is the purpose of Section 24J?

a)

To calculate taxable income for businesses


b)

To deduct capital expenses

c)

To include or deduct interest that accrues during the current year of assessment

d)


To calculate gross profit for companies

3.

Which of the following is not excluded from the definition of an income instrument under s24J(12)?


a)

Normal savings accounts

b)

Call account

c)

Instruments redeemable at any time

d)

Instruments issued at a discount or premium

4.

A holder refers to a person obligated to repay any amounts under the terms of an instrument.


a)

TRUE

b)

FALSE

5.

Mr. Z borrowed R100,000 from his cousin on 1 January 2025 to renovate his home. The agreement states that the loan is interest-free. Repayment must be made in full by 30 September 2025

Can Mr. Z deduct any amount under Section 24J(2)?

a)

YES

b)

NO

6.

Ms. Y acquired short-term bonds on 1 June 2025 with a face value of R250,000 issued at a discount of R50,000 redeemable on 31 March 2026. Coupon rate: 5% per annum. How much will she include in gross income in the 2026 year of assessment in terms of s24J (3) ?

a)

R10 000

b)

Rnil

7.

On 1 January 2024, Company ABC Ltd. issued a 5-year bond with a face value of R500,000

Issued at a discount of 10%. Annual coupon rate: 8%. Redeemable at par value on 31 December 2028, coupon payments are made semi-annually. Calculate the Yield To Maturity for the bond.

a)

10.68425%

b)

No solution

c)

9.59956%

8.

On 1 December 2025 ABC (Pty) Ltd purchased 500 government bonds with a face

value of R100 each for a discount of 5% for investment purposes. The bonds have a

maturity date of 30 November 2028 when ABC (Pty) Ltd will receive R140 per bond.

ABC (Pty) Ltd has a 31 March year-end. The interest accrued in the 2026 YOA is apportioned as follows:

a)

4/12 Months

b)

121/365 days

c)

4/6 months

d)

121/182 days

9.

On 1 July 2024, Mr. A borrowed R2,000,000 from a bank with an annual interest rate: 10% (compounded annually). The loan is repayable in 4 years at par, with irregular payments. Calculate the IRR (NPV)

• Year 1 (2025): R500,000

• Year 2 (2026) : Rnil

• Year 3 (2027): R700,000

• Year 4 (2028): R200,000

a)

4.52764%

b)

No solution

c)

10%

d)

13.22087%

10.

On 1 October 2024, XYZ Ltd. issued a 6-year bond with a face value of R1 000,000. Redeemable at a 5% premium on 30 September 2030 with a coupon rate: 9% per annum. Payments are made quarterly.

XYZ Ltd.’s financial year ends on 30 June 2025. Determine the interest accrued to XYZ in the 2025 YOA.

a)

9.06452%

b)

R90 645.23

c)

R272 116

d)

R291 566

11.

Mrs. B acquired a loan with a present value of R200 000 on 01 January 2024. She is required to make semi-annual payments of R25 000 on 30 June and 31 December each year. The loan has a yield to maturity of 7.64796%.

Calculate the interest on the 1st accrual period for the 2025 year of assessment made on 30 June 2024.

a)

R15 295.92

b)

R13 383.93

c)

Rnil

d)

R10 337.35