FAC1502 MOCK
EXAM
SOLUTIONS
FAC1502- MOCK
EXAMINATION QUESTIONS
AND ANSWERS 2020/2021
,
, FAC1502_MOCK EXAMINATION
1. Which one of the following transactions will result in a change in the equity of an entity operatingon a bank
overdraft?
✓ Expenses are the responsibility of the owner
✓ Even if the business is on an overdraft, the owner will have to transfer funds from his
personal account to pay his employee
A.
A direct deposit of the salary of an employee into his/her bank account.
B.
Receive money from a debtor in payment of his/her account.
C.
A direct deposit in the bank account of an entity by a creditor in payment of his/her account.
D.
A cheque issued for payment of assets purchased for cash.
E.
Property bought on credit.
AnswerPointValue:2.0points
AnswerKey:A
1
, 2. Which one of the following statements is correct?
A posting to the debit side of a ledger account will, where applicable, always have the effect of …
✓ Income account increase on the credit side and decrease on the debit side
A.
a decrease in the balance of an asset account.
B.
a decrease in the amount of a nominal account
C.
a decrease in the amount of an income account.
D.
a decrease in the amount of an expense account.
E.
an increase in the balance of a liability account.
AnswerPointValue:2.0points
AnswerKey:C
3. Which one of the following statements is correct?A.
Errors made by the bank are corrected in the cash journals. - errors made by the bank are rectified in the Bank
Reconciliation Statement
B.
A deposit made directly to the bank that appears on the bank statement should be included as a reconciling
item in the bank reconciliation statement. - it should be recorded on the supplementary Cash Receipts
Journal
C.
Errors made by the entity should appear as reconciling items in the bank reconciliation statement. - Errors made
by the entity are rectified in the Cash Journals
D.
A credit balance in the bank statement and a debit balance in the entity’s bank account in the ledger show a
favorable bank balance.
The bank treats a business as its CREDITOR when the business has funds in its account, the
bank will be liable to pay the business. The balance as per the Bank statement is favorable of the
credit side.
Bank account is an asset and assets increase on the debit side. A debit balance of the bank account
is favourable.
E.
Both (A) and (C) above.
AnswerPointValue:2.0points
AnswerKey:D
2
EXAM
SOLUTIONS
FAC1502- MOCK
EXAMINATION QUESTIONS
AND ANSWERS 2020/2021
,
, FAC1502_MOCK EXAMINATION
1. Which one of the following transactions will result in a change in the equity of an entity operatingon a bank
overdraft?
✓ Expenses are the responsibility of the owner
✓ Even if the business is on an overdraft, the owner will have to transfer funds from his
personal account to pay his employee
A.
A direct deposit of the salary of an employee into his/her bank account.
B.
Receive money from a debtor in payment of his/her account.
C.
A direct deposit in the bank account of an entity by a creditor in payment of his/her account.
D.
A cheque issued for payment of assets purchased for cash.
E.
Property bought on credit.
AnswerPointValue:2.0points
AnswerKey:A
1
, 2. Which one of the following statements is correct?
A posting to the debit side of a ledger account will, where applicable, always have the effect of …
✓ Income account increase on the credit side and decrease on the debit side
A.
a decrease in the balance of an asset account.
B.
a decrease in the amount of a nominal account
C.
a decrease in the amount of an income account.
D.
a decrease in the amount of an expense account.
E.
an increase in the balance of a liability account.
AnswerPointValue:2.0points
AnswerKey:C
3. Which one of the following statements is correct?A.
Errors made by the bank are corrected in the cash journals. - errors made by the bank are rectified in the Bank
Reconciliation Statement
B.
A deposit made directly to the bank that appears on the bank statement should be included as a reconciling
item in the bank reconciliation statement. - it should be recorded on the supplementary Cash Receipts
Journal
C.
Errors made by the entity should appear as reconciling items in the bank reconciliation statement. - Errors made
by the entity are rectified in the Cash Journals
D.
A credit balance in the bank statement and a debit balance in the entity’s bank account in the ledger show a
favorable bank balance.
The bank treats a business as its CREDITOR when the business has funds in its account, the
bank will be liable to pay the business. The balance as per the Bank statement is favorable of the
credit side.
Bank account is an asset and assets increase on the debit side. A debit balance of the bank account
is favourable.
E.
Both (A) and (C) above.
AnswerPointValue:2.0points
AnswerKey:D
2
