FAC1601 ASSESSMENT 2 SEM 3 OF 2024 EXPECTED QUESTIONS AND ANSWERS(with wrkings)
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Course
Financial Accounting and Reporting (FAC1601)
Institution
University Of South Africa (Unisa)
THIS DOCUMENT CONTAINS FAC1601 ASSESSMENT 2 SEM 3 OF 2024 EXPECTED QUESTIONS AND ANSWERS(with workings). USE IT CORRECTLY AS A GUIDE TO OBTAIN A MARK ABOVE 75%
IMPORTANT: THE QUESTIOINS ARE CHANGING CERTAIN FIGURES AND CERTAIN
INFORMATION TO MAKE THE QUESTIONS DIFFERENT, PLEASE CHECK
AND COMPARE ESPECIALLY THE HIGHLIGHTED FIGURES AND INFORMATION
Didi and Chomi are running a business, VaalPure Innovations, a company that
specialises in developing cutting-edge water filtration systems for industrial use.
VaalPure Innovations operates in the environmental technology sector, focusing
on providing sustainable solutions to industries dealing with water scarcity and
pollution. Didi and Chomi are in a partnership and share profits and losses in a
ratio of 3:2 respectively.
i have also included some computattions
On 30 July 2024 the following information was extracted from the accounting
records of the partnership:
R
Capital - Didi R183,800
Capital - Chomi R168,700
Current account - Didi (dr) R44,000
Current account - Chomi (dr) R33,000
Additional information:
1. On 1 August 2024, Didi and Chomi decided to admit Lebo to the business as a
new partner. Lebo will contribute the following to acquire a fifth of the net asset
share of the partnership
Cash…................................................... R 35 000
NP200 Bakkie worth…......................... R120 000
2. Didi and Chomi agreed to relinquish 20% of their share in profits or losses to
Lebo in the ratio of 3:1 respectively
3. All other assets were revalued before admitting Lebo to the partnership.
4. A valuation profit was correctly calculated at R18 000.
Correct balance which represents the correct amount of goodwill in the
accounting records of VaalPure Innovations after the admission of Lebo?
Instructions:
1. Round off to the nearest Rand (eg: 50.56 is 51)
2. Only show the amount, do not show the R (eg: 12000)
, Didi and Chomi are running a business, VaalPure Innovations, a company that
specialises in developing cutting-edge water filtration systems for industrial use.
VaalPure Innovations operates in the environmental technology sector, focusing
on providing sustainable solutions to industries dealing with water scarcity and
pollution. Didi and Chomi are in a partnership and share profits and losses in a
ratio of 3:2 respectively.
On 30 July 2024 the following information was extracted from the accounting
records of the partnership:
R
Capital - Didi R183,800
Capital - Chomi R168,700
Current account - Didi (cr) R44,000
Current account - Chomi (cr) R33,000
if (dr subtract)
Additional information:
1. On 1 August 2024, Didi and Chomi decided to admit Lebo to the business as a
new partner. Lebo will contribute the following to acquire a fifth of the net asset
share of the partnership
Cash…................................................... R 35 000
NP200 Bakkie worth…......................... R120 000
2. Didi and Chomi agreed to relinquish 20% of their share in profits or losses to
Lebo in the ratio of 3:1 respectively
3. All other assets were revalued before admitting Lebo to the partnership.
4. A valuation profit was correctly calculated at R18 000.
Correct amount which represents the correct balance in the capital
account of Didi after the valuation of assets and prior to the admission of Lebo?
Instructions: if loss subtract
1. Round off to the nearest Rand (eg: 50.56 is 51)
2. Only show the amount, do not show the R (eg: 12000)
183800+44000+3/5*18000
Answer: 238600
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Pre vi o us ac t i vi t y
Assessment 1
,Trading under the name Lehumo Bricks, Refentse and Boitshepo are
partners in this brick manufacturing company. Over the years, Lehumo
Bricks has established itself as a reputable supplier of high-quality bricks
used in various construction projects, from residential homes to large
commercial buildings. The business has been profitable, with Refentse
and Boitshepo sharing profits and losses equally, reflecting their initial
capital investments and contributions to the partnership.
However, after years of operating in the competitive construction
materials industry, the partners decided to liquidate the business. Their
decision was influenced by a combination of factors, including changes in
market demand, increasing production costs, and their desire to pursue
other ventures.
Having carefully evaluated offers for key assets, particularly the land, the
building, manufacturing equipment and inventory on hand, they decided to
accept the most favourable ones for the sale of the land, inventory and
equipment. With this decision in place, they planned to initiate the
simultaneous liquidation of the partnership on 1 June 2024.
Before any liquidation entries were recorded, they prepared a final trial
balance to summarise the financial position of the business.
EXTRACT OF TRIAL BALANCE AS AT 1 JUNE 2024
R
Equipment at carrying amount R290,0
Long-term loan -R968,5
Land and building at carrying amount R792,0
Inventory R256,0
Capital – Refentse -R268,9
Capital – Boitshepo -R285,9
Current account – Refentse (dr) R45,2
Current account – Boitshepo (dr) R20,4
Bank R119,7
On 1 June 2024, a series of financial transactions took place to finalise
the sale of the business’s assets and settle its liabilities. Below is a
summary of the key transactions that occurred during the liquidation:
1. The land and buildings, which had been integral to Lehumo Bricks'
manufacturing operations, were sold for a cash amount of R855
000.
2. Boitshepo, one of the partners, took over certain brick-making
equipment with a carrying amount of R87 600. While Boitshepo
did not pay for the equipment immediately, the partners agreed on
a cash value of R74 000 for this transaction.
3. The remaining brick-making equipment was sold to an external
buyer at a carrying value in cash.
4. The costs associated with the liquidation process amounted to R45
500. These costs included legal fees, administrative expenses, and
other charges incurred during the winding-up of the business.
5. The inventory of bricks and raw materials was sold for R210 000.
The sale of these finished goods and materials added substantial
cash to the liquidation process, ensuring that more of the
partnership’s liabilities could be paid off.
6. Lehumo Bricks had an outstanding long-term loan, which was fully
paid off during the liquidation process at a negotiated settlement
amount of R800 000.
, Which one of the following alternatives represents the correct amount that
must be allocated to Refentse on as liquidation profit (loss) of Lehumo
Bricks on 1 June 2024?
a. -R35,200
b. R35,200
c. R85,950
d. R63,200
e. R63,450
f. R58,700
g. -R63,200
Clear my choice
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Pre vi o us
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Assessment 1
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