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FAC1502 ASSESSMENT PACK SOCLUTIONS 2023
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FAC1502 ASSESSMENT PACK SOCLUTIONS 2023
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QuestionDrawings will __________in the statement of profit and loss and other comprehensive income.
A. be disclosed as revenue
B. not be disclosed in the statement of profit and loss and other comprehensive income
C. be disclosed as other income
D. be disclosed as finance costs
E. be disclosed as distribution, administrative and other expenses
Question
Which one of the following users will use accounting information to assess the contribution of the entity
to the economy and the creation of work opportunities?
A. Employees
B. The public
C. Government
D. Lenders
E. Clients
Question
The term used to describe the entity’s ability to continue to operate for the foreseeable future is referred
to as________
A. profitability
B. going concern
C. understandability
D. eternal
E. relevance
Question
Which of the following is not an external user of financial information?
A. Investors
B. Creditors
C. Public
D. Employees
E. Government
Question
Dubai Mountains made a direct payment to Sbali Limited to settle an amount owing of R12 000 for
business supplies. What is the effect of this transaction on the general ledger accounts of Dubai
Mountains?
A. The inventory account will increase with R12 000 and the trade payables account will
increase with R12 000.
B. The bank account will decrease with R12 000 and the trade receivables account will
increase with R12 000
C. The bank account will decrease with R12 000 and the trade payables account will
decrease with R12 000.
D. The inventory account will decrease with R12 000 and the trade payables account will
will increase with R12 000
E. The bank account will increase with R12 000 and the trade payables account will increase
with R12 000.
,Question
Dubai Mountains paid monthly salaries of R8 500. What is the effect of this transaction on the accounts
of the basic accounting equation?
A. Bank decreases equity by R8 500 and salaries decreases assets by R8 500.
B. Bank decreases assets by R8 500 and salaries increases liabilities by R8 500.
C. Trade receivables increases assets by R8 500 and trade payables increases liabilities by R8 500.
D. Bank increases assets by R8 500 and trade payables increases liabilities by R8 500.
E. Bank decreases assets by R8 500 and salaries decreases equity by R8 500.
Question
Make-it-Grow Salon bought hair trimming equipment from Wall Trimmers for R3 500 cash. What is the
net effect of this transaction on the elements of the basic accounting equation?
A. Net effect on assets is R7 500 increase.
B. Net effect on assets is R3 500 increase.
C. Net effect on liabilities is R3500 increase.
D. Net effect on assets is R0.
E. Net effect on equity is R3 500 decrease.
Question
Which one of the following accounts will cause an increase in equity?
A. Expenses.
B. Revenue.
C. Withdrawals by the owner.
D. Bank
E. Trade receivables.
Question
The bookkeeper will record the transactional information on a duplicate credit note in the__________
A. Purchases returns journal
B. Cash receipts journal
C. Sales journal
D. Purchases journal
E. Sales returns journal
Question
The owner of HS Stores took inventory to the value of R2 000 for his own personal use. In which journal
will the bookkeeper record this transaction?
A. Cash receipts journal
B. Purchases journal
C. General journal
D. Purchases returns journal
E. Cash payments journal
,Question
The bookkeeper of HS Stores will enter the interest charged on an unfavourable bank balance in the
__________of HS Stores.
A. bank statement
B. bank reconciliation statement
C. cash payments journal
D. petty cash journal
E. cash receipts journal
Question
A debtor of HS Stores paid R5 000 in full settlement of his account via internet banking. In which journal
will the bookkeeper of HS Stores record this transaction?
A. General journal
B. Cash receipts journal
C. Cash payments journal
D. Sales journal
E. Sales returns journal
Question
Inventory sold on credit will be recorded in the_______ journal.
A. general
B. sales
C. cash payments
D. cash receipts
E. sales returns
Question
HS Stores purchased equipment on credit from RG Traders for R11 270 (inclusive of 15% VAT). The
VAT input amount (rounded off to the nearest rand) on this credit purchase is ___________
A. R1 384
B. R9 800
C. R1 691
D. R1 578
E. R1 470
Calculations: 11 270*15/115 = 1 470
Question
Credit losses recovered will be disclosed as a /an ___________ in the financial statements of an entity.
A. non- current asset
B. income
C. current liability
D. current asset
E. expense
, Question
Where in the statement of financial position would a business that trades in the sale of motor vehicles
disclose the fleet truck it uses to deliver sold vehicles to customers?
A. Current liabilities: Trade payables
B. Non-current assets: Property, plant and equipment
C. Current assets: Property, plant and equipment
D. Current assets: Trade receivables
E. Current assets: Inventory
Question
Which one of the following statements correctly defines liabilities?
A. Liabilities are present obligations of a reporting entity to transfer economic resources as a result of
past events.
B. Liabilities are present economic resources controlled by the entity because of past events.
C. Liabilities are the residual interest in the assets of an entity after deducting all its liabilities.
D. Liabilities are commonly known as the obligations of the entity.
Question
What is included in the statement of financial position of a business?
A. Assets, liabilities, profit on disposal of non-current assets.
B. Capital, drawings, assets and liabilities.
C. Income, expenses, assets and liabilities.
D. Assets, discounts and liabilities.
E. Capital, sales and assets.
Question
Which of the following statements are incorrect?
A. Fair value is the price that would be received to sell an asset, or paid to transfer a liability, in an
orderly transaction between participants at the measurement date
B. Current value measurement basis provides information updated to reflect conditions at current
measurement date
C. Current cost reflects the current amount that would be received to acquire an equivalent asset
D. According to current basis, liabilities are carried at the discounted amount of cash or cash equivalent
that would be required to settle the obligation currently
E. According to the current cost basis, assets are carried at the amount of cash or cash equivalent that
could currently be obtained by selling the asset in an orderly disposal.
Question
Which of the following statement/s is/are incorrect?
A. Trade payables and long-term loans are examples of debts that an entity can have.
B. Assets may be exchanged for other assets.
C. The conversion of an obligation into equity is way in which an obligation can be settled.
D. A vehicle financed by a bank is an example of an asset, which is controlled by entity by not owned by
entity until the final instalment is paid.
E. Debentures and the current portion of a long-term borrowing are examples of non-current liabilities.
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