Exam (elaborations)
FAC1502 ASSESSMENT 4 2023
- Institution
- University Of South Africa (Unisa)
FAC1502 ASSESSMENT 4 2023
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6/18/23, 2:02 PM Assessment 4MENU
Dashboard / Courses / UNISA / 2023 / Semester 1 / FAC1502-23-S1 / Welcome Message / Assessment 4
Question 1
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Indicate whether the following statement is true or false:
Liabilities are present obligations of a reporting entity to transfer economic resources as a result of past events.
Select one:
True
False
Question 2
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Indicate by choosing the correct option whether the following statement is true or false:
One of the steps to calculate sales if no distinction can be made between cash and credit sales, if you want to convert a single-entry system into a
double-entry system where minimal records are kept, is to calculate the amounts with the aid of the trade receivables control account.
Select one:
True
False
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,6/18/23, 2:02 PM Assessment 4
Question 3
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The following information relates to Bi-Lock Traders for the year ended 28 February 20.19.
Dashboard / Courses / UNISA / 2023 / Semester 1 / FAC1502-23-S1 / Welcome Message / Assessment 4
Bi-Lock Traders sells bicycles and bicycle equipment. The inexperienced accountant prepared the final accounts before taking most of the adjustments
into account and has made some errors in the determination of the profit.
BI-LOCK TRADERS
GENERAL LEDGER
Dr Trading account Cr
R R
20.19 20.19
Feb 28 Cost of sales 1 816 080 Feb 28 Sales 2 705 644
Profit or loss 889 564
2 705 644 2 705 644
Dr Profit or loss account Cr
R R
20.19 20.19
Feb 28 Accounting fees 15 000 Feb 28 Trading account 889 564
Credit losses 17 500 Credit losses recovered 8 830
Consumable stores 60 460 Settlement discount
Sales returns 24 500 received 18 669
Depreciation 80 840 Interest on current
Settlement discount account 122
granted 11 160 Interest income (on
Insurance 84 600 overdue trade
Interest on overdraft 5 125 receivables control
Interest expenses (on account) 465
overdue trade Rental income 66 500
payables 570
Salaries and wages 568 812
Sundry operating
expenses 116 143
984 710 984 710
BI-LOCK TRADERS
EXTRACT FROM PRE-ADJUSTMENT TRIAL BALANCE AT 28 FEBRUARY 2019
Debit Credit
R R
Loan: Watson Bank (8% p.a.) (1 March 20.18)……………………………… 300 000
Fixed deposit: Pedal Bank (6% p.a.)……………………………...………….. 60 000
Trading inventory..……………………………………………………………… 245 950
Trade receivables control .……………………………………………………. 127 800
Allowance for credit losses…………………………………………….……… 6 400
Additional information
1. A debtor returned a bicycle sold to him for R14 000 because it was faulty. A mark-up of 75% on cost is used. It was immediately returned to the
supplier. No entries were made in the accounting records of Bi-Lock Traders in connection with these transactions.
2. A physical inventory count revealed that trading inventory on hand at the end of the financial year actually amounted to R228 500.
3. Consumable stores amount to only R35 000, the amount recorded in the profit or loss was incorrect.
4. An amount of R1 600 was received from a debtor who has been declared insolvent at year end and has been correctly recorded. The amount
received is 40% the total debt owed by the debtor. No entries have been made to record the credit loss.
5. The allowance for credit losses must be adjusted to 4% of outstanding trade receivables.
6. Insurance includes an amount of R6 000 which has been paid for the period 1 May 20.18 to 30 April 20.19.
7. Rent has been received until 31 March 20.19. The rent was increased by R250 per month from 1 October 20.18.
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,6/18/23, 2:02 PM Assessment 4
8. The investment in a fixed deposit at Pedal Bank was made on 1 January 20.19. No interest has been received yet.
9. An amount of R560 was received from M Moriarty. His account has previously been written off as irrecoverable as he has immigrated to Canada.
No entries regarding this transaction have been recorded in the accounting records, yet.
MENU
Prepare the correct trading section and other income section of the statement of profit or loss and other comprehensive income of Bi-Lock
Dashboard
Traders / Courses
for the / UNISA
year ended / 202320.19.
28 February / Semester 1 / FAC1502-23-S1 / Welcome Message / Assessment 4
Instructions:
Drag the correct answer into the correct space.
An option can be used more than once.
Keep the sequence strictly according to the information given in the wrong trading account and profit or loss account.
Revenue 2 655 984
Cost of sales (1 797 411)
Gross profit
866 573
Other income
Rental income 61 250
Interest income 1 187
Credit losses recovered 9 390
Purchases Settlement discount received Gross loss Rental income Inventory (opening)
Interest on current account Interest income Revenue Credit losses recovered Other income
Cost of sales Sales Inventory (closing) Gross profit
66 500 122 866 573 8 830 9 390 245 950 (228 500) (1 783 411) 61 250 228 500 587
2 655 984 36 000 (1 797 411) 2 669 984 2 705 644 (245 950) 3 600 1 187 2 661 984 (1 816 080) 2 681 144
2 662 475 (1 789 411) 465 600 (228 500) 61 385
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, 6/18/23, 2:02 PM Assessment 4
Question 4
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On 1 September 20.18 Mr Will Turner started a new blacksmith business called Iron Duke. Iron Duke manufactures and sells domestic cast iron
Dashboard
furniture. The/ following
Courses transactions
/ UNISA / took
2023 / Semester
place during the1 first
/ FAC1502-23-S1
financial year of/theWelcome Message
entity ending / Assessment
31 August 20.19. 4
On 1 September 20.18 the owner, Mr Will Turner, made the following capital contributions:
Firstly, he invested a cash amount of R100 000 from his personal savings account into the business bank account.
He then made his new personal machine, the Belt Grinder, available to the business. The cost of the Belt Grinder was R15 000.
He also contributed his personal delivery van which had cost R45 000 when new. The vehicle was bought on 1 September 20.16 by Mr Will Turner
and had a carrying value of R27 000 on 1 September 20.18 with only 3 years useful life remaining.
Show the effect of each transaction on the basic accounting equation with a plus sign (+) for an increase and a minus sign (-) for a decrease next
to each amount under each element. Also indicate the account(s) that will be affected by each transaction next to the affected elements for the
financial year ended 31 August 20.19. (The business makes use of the perpetual inventory system.)
Instructions:
Drag the correct answer into the correct space.
An option can be used more than once.
If an options has been provided and it is not applicable to the specific questions please put N/A in the accounts column and a 0 in the amounts column.
Keep the transactions strictly in the order they were given.
+100 000 Bank +100 000 Capital 0 N/A
+27 000 Vehicles +27 000 Capital 0 N/A
+15 000 Machinery +15 000 Capital 0 N/A
Bank Equipment Machinery Accumulated depreciation
Vehicles Drawings Capital Mr Will Turner/Trade receivables control
N/A Mr Will Turner/Trade payables control
+100 000 +27 000 -18 000 +45 000 -100 000 -45 000 +18 000 -15 000 -27 000 0 +15 000
Question 5
Not yet answered
Marked out of 1.00
Indicate whether the following statement is true or false:
According to the current value measurement basis, liabilities should be recorded at the amount paid or the fair value of the consideration given to
acquire the liability at the time of their acquisition.
Select one:
True
False
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