FAC1601/QUESTION BANK
DEPARTMENT OF FINANCIAL ACCOUNTING
FAC1601: FINANCIAL ACCOUNTING REPORTING 1
FAC1601 QUESTION BANK
(SEMESTER 1 & SEMESTER 2)
Mr MT Hlongoane
Mrs FM Osman
Mr A Eysele
Mr J van Staden
Mrs B Ntoyanto-Ceki
Module Telephone Number: 012 429 4176
Module E-mail Address:
, FAC1601/QUESTION BANK
CONTENTS
ANNEXURE A: MAY/JUNE 2010 EXAMINATION........................................................................... 3
ANNEXURE B: OCTOBER/NOVEMBER 2010 EXAMINATION .................................................... 11
ANNEXURE C: MAY/JUNE 2011 EXAMINATION ........................................................................ 19
ANNEXURE D: OCTOBER/NOVEMBER 2011 EXAMINATION.................................................... 28
ANNEXURE E: MAY/JUNE 2012 EXAMINATION......................................................................... 37
ANNEXURE F: OCTOBER/NOVEMBER 2012 EXAMINATION .................................................... 44
ANNEXURE G: MAY/JUNE 2010 MEMORANDUM ...................................................................... 53
ANNEXURE H: OCTOBER/NOVEMBER 2010 MEMORANDUM ................................................. 61
ANNEXURE I: MAY/JUNE 2011 MEMORANDUM ........................................................................ 69
ANNEXURE J: OCTOBER/NOVEMBER 2011 MEMORANDUM .................................................. 75
ANNEXURE K: MAY/JUNE 2012 MEMORANDUM ...................................................................... 81
ANNEXURE L: OCTOBER/NOVEMBER 2012 MEMORANDUM .................................................. 86
2
, FAC1601/QUESTION BANK
ANNEXURE A: MAY/JUNE 2010 EXAMINATION
This paper comprises 8 pages.
PLEASE NOTE:
1. Ensure that you are writing the correct examination paper.
2. Ensure that you are handed the correct examination answer book (BLUE) by the invigilator.
3. All questions must be answered.
4. Basic calculations, where applicable, must be shown.
5. Each question must be commenced on a new (separate) page.
6. Please do not answer the paper in pencil.
PROPOSED TIMETABLE
(try not to deviate from this)
Time in
Question Subject Marks minutes
1 Statement of profit or loss and other comprehensive income and
partial current account: Partnership 25 30
2 Change in the ownership structure of a partnership: Valuation
account, capital account and calculation of profit-sharing ratio
16 20
3 Statement of cash flows – CASH FLOWS FROM OPERATING
ACTIVITIES-section: Close corporation 21 25
4 General journal entries pertaining to the issue of shares and
dividends payable: Company 17 20
5 Branch inventory account 21 25
TOTAL 100 120
3
, FAC1601/QUESTION BANK
QUESTION 1 (25 marks)(30 minutes)
Amanda and Sphindile are in a partnership trading as A&S Supermarket. The following information
pertains to the partnership:
1. List of balances as at 31 December 2009
R
Capital: Amanda (1 January 2009) .................................................................................. 350 000
Capital: Sphindile (1 January 2009) ................................................................................ 250 000
Current account: Amanda (1 January 2009) (cr) ............................................................. 60 000
Current account: Sphindile (1 January 2009) (dr) ............................................................ 40 000
Land and buildings at cost .............................................................................................. 494 000
Vehicles at cost ............................................................................................................... 198 000
Accumulated depreciation: Vehicles (1 January 2009) .................................................... 42 000
Debtors control ............................................................................................................... 145 560
Creditors control ............................................................................................................. 106 300
Bank (dr) ......................................................................................................................... 26 582
Fixed deposit: Third National Bank ................................................................................. 19 000
Drawings: Amanda.......................................................................................................... 64 800
Drawings: Sphindile ........................................................................................................ 43 200
Loan to Sphindile ............................................................................................................ 40 800
Loan from Amanda ......................................................................................................... 170 000
Allowance for credit losses .............................................................................................. 2 500
Sales............................................................................................................................... 650 000
Purchases ....................................................................................................................... 304 000
Inventory (merchandise) (1 January 2009) ...................................................................... 70 800
Salaries and wages......................................................................................................... 132 960
Water and electricity ....................................................................................................... 4 700
Interest expense: Loan from Amanda ............................................................................. 5 400
Settlement discount granted ........................................................................................... 3 800
Interest income: Fixed deposit ........................................................................................ 1 710
Stationery consumed ...................................................................................................... 5 000
Telephone expenses....................................................................................................... 26 208
Insurance on purchases ................................................................................................ 4 500
Freight on sales .............................................................................................................. 3 200
2. Partnership agreement:
The partnership agreement stipulates the following:
2.1 The partners Amanda and Sphindile share the profits or losses in the ratio of 3:2
respectively.
2.2 Interest at 10% per annum is allowed on the opening balances of the partners’ capital
accounts.
2.3 Amanda is entitled to a 10% commission on sales.
3. Year-end adjustments:
3.1 Inventory on hand at 31 December 2009:
R
Merchandise 83 000
Stationery (stationery purchased is recorded in the stationery consumed account) 850
QUESTION 1 (continued)
4
, FAC1601/QUESTION BANK
3.2 On 30 September 2009, a delivery vehicle was purchased for R85 000 cash. All the
necessary entries were made in the books.
3.3 Depreciation must be provided on vehicles at 10% per annum according to the straight-line
method.
3.4 The loan from Amanda was obtained on 1 September 2007 at 5% interest per annum. The
loan will be repaid in five equal annual instalments, starting from 31 December 2010. The
interest must be paid to Amanda annually.
3.5 During the financial year Sphindile was granted an interest free loan which she agreed to
settle in full on 30 June 2010.
3.6 The water and electricity account of R400 for December 2009 was received on
10 January 2010.
3.7 A debtor owing the business R5 560 has for the past financial year defaulted on his
payments and his account must be written off as irrecoverable. The allowance for credit
losses must be adjusted to R3 200.
3.8 During the financial year R40 000 was paid to Amanda as commission on sales. These
payments were recorded in the salaries and wages account.
3.9 The fixed deposit at Third National Bank was made on 1 January 2008 for a period of 5 years
at 9% interest per annum. The interest is receivable at the end of each borrowing year.
REQUIRED:
1.1 Prepare the statement of profit or loss and other comprehensive income of A&S
Supermarket for the year ended 31 December 2009. Your answer must comply
with the requirements of International Financial Reporting Standards (IFRS)
appropriate to the business of the partnership (notes and comparative figures are (20)
not required).
1.2 Prepare the current account of Amanda in the general ledger of A&S Supermarket
for the year ended 31 December 2009. The profit/loss for the year need not be
appropriated and do not balance the account. Each entry must disclose the
correct contra ledger account. (5)
[25]
NB: Show all calculations.
5
, FAC1601/QUESTION BANK
QUESTION 2 (16 marks)(20 minutes)
Chris, Brown and Rehanna were in a partnership trading as R&B Entertainment, and shared the
profits and losses of the partnership in the ratio of 5:3:2 respectively. Due to claims of a
disproportionate allocation of royalties earned from the hit Umbrero, which consequently led to a
war of words amongst the partners, Rehanna decided to quit the partnership. The last date that
she acted as a partner was 30 April 2010, the end of the financial year of the partnership. Chris
and Brown decided to continue with the business activities of the partnership and formed a new
partnership on 1 May 2010. Chris and Brown agreed to take over Rehanna’s profit share equally.
The following information pertains to R&B Entertainment:
1. Balances as at 30 April 2010
R
Land and buildings ........................................................................................................... 280 000
Furniture and equipment .................................................................................................. 45 000
Accumulated depreciation: Furniture and equipment ....................................................... 15 000
Debtors control (royalties receivable) ............................................................................... 37 500
Bank (dr) .......................................................................................................................... 6 000
Capital: Chris ................................................................................................................... 76 000
Capital: Brown ................................................................................................................. 73 600
Capital: Rehanna ............................................................................................................. 60 400
Current account: Chris (dr)............................................................................................... 7 400
Current account: Brown (cr) ............................................................................................. 21 600
Current account: Rehanna (cr) ......................................................................................... 19 800
Asset replacement reserve .............................................................................................. 78 000
Creditors control .............................................................................................................. 31 500
2. Additional information:
In preparation for the retirement of Rehanna on 30 April 2010, the following information must be
taken into account:
2.1 The land and buildings were valued at R350 000.
2.2 The partners were advised that the royalties due to them were understated by R50 000.
2.3 As a result of the popularity of the Umbrero song, the partners resolved that goodwill must be
set at R50 000.
2.4 The partners agreed that Rehanna could take a fashionable set of microphones of the
partnership with a carrying amount of R5 700 as partial payment of her account and that the
outstanding balance on her account will be settled in cash at 31 May 2010.
REQUIRED:
2.1 Prepare the valuation account, properly closed off, in the general ledger of
R&B Entertainment. (5)
2.2 Prepare the capital account of Rehanna, properly closed off, in the general ledger
of R&B Entertainment for the year ended 30 April 2010. (7)
2.3 Calculate the profit-sharing ratio of Chris and Brown on 1 May 2010. (4)
[16]
NB: Show all calculations.
6
DEPARTMENT OF FINANCIAL ACCOUNTING
FAC1601: FINANCIAL ACCOUNTING REPORTING 1
FAC1601 QUESTION BANK
(SEMESTER 1 & SEMESTER 2)
Mr MT Hlongoane
Mrs FM Osman
Mr A Eysele
Mr J van Staden
Mrs B Ntoyanto-Ceki
Module Telephone Number: 012 429 4176
Module E-mail Address:
, FAC1601/QUESTION BANK
CONTENTS
ANNEXURE A: MAY/JUNE 2010 EXAMINATION........................................................................... 3
ANNEXURE B: OCTOBER/NOVEMBER 2010 EXAMINATION .................................................... 11
ANNEXURE C: MAY/JUNE 2011 EXAMINATION ........................................................................ 19
ANNEXURE D: OCTOBER/NOVEMBER 2011 EXAMINATION.................................................... 28
ANNEXURE E: MAY/JUNE 2012 EXAMINATION......................................................................... 37
ANNEXURE F: OCTOBER/NOVEMBER 2012 EXAMINATION .................................................... 44
ANNEXURE G: MAY/JUNE 2010 MEMORANDUM ...................................................................... 53
ANNEXURE H: OCTOBER/NOVEMBER 2010 MEMORANDUM ................................................. 61
ANNEXURE I: MAY/JUNE 2011 MEMORANDUM ........................................................................ 69
ANNEXURE J: OCTOBER/NOVEMBER 2011 MEMORANDUM .................................................. 75
ANNEXURE K: MAY/JUNE 2012 MEMORANDUM ...................................................................... 81
ANNEXURE L: OCTOBER/NOVEMBER 2012 MEMORANDUM .................................................. 86
2
, FAC1601/QUESTION BANK
ANNEXURE A: MAY/JUNE 2010 EXAMINATION
This paper comprises 8 pages.
PLEASE NOTE:
1. Ensure that you are writing the correct examination paper.
2. Ensure that you are handed the correct examination answer book (BLUE) by the invigilator.
3. All questions must be answered.
4. Basic calculations, where applicable, must be shown.
5. Each question must be commenced on a new (separate) page.
6. Please do not answer the paper in pencil.
PROPOSED TIMETABLE
(try not to deviate from this)
Time in
Question Subject Marks minutes
1 Statement of profit or loss and other comprehensive income and
partial current account: Partnership 25 30
2 Change in the ownership structure of a partnership: Valuation
account, capital account and calculation of profit-sharing ratio
16 20
3 Statement of cash flows – CASH FLOWS FROM OPERATING
ACTIVITIES-section: Close corporation 21 25
4 General journal entries pertaining to the issue of shares and
dividends payable: Company 17 20
5 Branch inventory account 21 25
TOTAL 100 120
3
, FAC1601/QUESTION BANK
QUESTION 1 (25 marks)(30 minutes)
Amanda and Sphindile are in a partnership trading as A&S Supermarket. The following information
pertains to the partnership:
1. List of balances as at 31 December 2009
R
Capital: Amanda (1 January 2009) .................................................................................. 350 000
Capital: Sphindile (1 January 2009) ................................................................................ 250 000
Current account: Amanda (1 January 2009) (cr) ............................................................. 60 000
Current account: Sphindile (1 January 2009) (dr) ............................................................ 40 000
Land and buildings at cost .............................................................................................. 494 000
Vehicles at cost ............................................................................................................... 198 000
Accumulated depreciation: Vehicles (1 January 2009) .................................................... 42 000
Debtors control ............................................................................................................... 145 560
Creditors control ............................................................................................................. 106 300
Bank (dr) ......................................................................................................................... 26 582
Fixed deposit: Third National Bank ................................................................................. 19 000
Drawings: Amanda.......................................................................................................... 64 800
Drawings: Sphindile ........................................................................................................ 43 200
Loan to Sphindile ............................................................................................................ 40 800
Loan from Amanda ......................................................................................................... 170 000
Allowance for credit losses .............................................................................................. 2 500
Sales............................................................................................................................... 650 000
Purchases ....................................................................................................................... 304 000
Inventory (merchandise) (1 January 2009) ...................................................................... 70 800
Salaries and wages......................................................................................................... 132 960
Water and electricity ....................................................................................................... 4 700
Interest expense: Loan from Amanda ............................................................................. 5 400
Settlement discount granted ........................................................................................... 3 800
Interest income: Fixed deposit ........................................................................................ 1 710
Stationery consumed ...................................................................................................... 5 000
Telephone expenses....................................................................................................... 26 208
Insurance on purchases ................................................................................................ 4 500
Freight on sales .............................................................................................................. 3 200
2. Partnership agreement:
The partnership agreement stipulates the following:
2.1 The partners Amanda and Sphindile share the profits or losses in the ratio of 3:2
respectively.
2.2 Interest at 10% per annum is allowed on the opening balances of the partners’ capital
accounts.
2.3 Amanda is entitled to a 10% commission on sales.
3. Year-end adjustments:
3.1 Inventory on hand at 31 December 2009:
R
Merchandise 83 000
Stationery (stationery purchased is recorded in the stationery consumed account) 850
QUESTION 1 (continued)
4
, FAC1601/QUESTION BANK
3.2 On 30 September 2009, a delivery vehicle was purchased for R85 000 cash. All the
necessary entries were made in the books.
3.3 Depreciation must be provided on vehicles at 10% per annum according to the straight-line
method.
3.4 The loan from Amanda was obtained on 1 September 2007 at 5% interest per annum. The
loan will be repaid in five equal annual instalments, starting from 31 December 2010. The
interest must be paid to Amanda annually.
3.5 During the financial year Sphindile was granted an interest free loan which she agreed to
settle in full on 30 June 2010.
3.6 The water and electricity account of R400 for December 2009 was received on
10 January 2010.
3.7 A debtor owing the business R5 560 has for the past financial year defaulted on his
payments and his account must be written off as irrecoverable. The allowance for credit
losses must be adjusted to R3 200.
3.8 During the financial year R40 000 was paid to Amanda as commission on sales. These
payments were recorded in the salaries and wages account.
3.9 The fixed deposit at Third National Bank was made on 1 January 2008 for a period of 5 years
at 9% interest per annum. The interest is receivable at the end of each borrowing year.
REQUIRED:
1.1 Prepare the statement of profit or loss and other comprehensive income of A&S
Supermarket for the year ended 31 December 2009. Your answer must comply
with the requirements of International Financial Reporting Standards (IFRS)
appropriate to the business of the partnership (notes and comparative figures are (20)
not required).
1.2 Prepare the current account of Amanda in the general ledger of A&S Supermarket
for the year ended 31 December 2009. The profit/loss for the year need not be
appropriated and do not balance the account. Each entry must disclose the
correct contra ledger account. (5)
[25]
NB: Show all calculations.
5
, FAC1601/QUESTION BANK
QUESTION 2 (16 marks)(20 minutes)
Chris, Brown and Rehanna were in a partnership trading as R&B Entertainment, and shared the
profits and losses of the partnership in the ratio of 5:3:2 respectively. Due to claims of a
disproportionate allocation of royalties earned from the hit Umbrero, which consequently led to a
war of words amongst the partners, Rehanna decided to quit the partnership. The last date that
she acted as a partner was 30 April 2010, the end of the financial year of the partnership. Chris
and Brown decided to continue with the business activities of the partnership and formed a new
partnership on 1 May 2010. Chris and Brown agreed to take over Rehanna’s profit share equally.
The following information pertains to R&B Entertainment:
1. Balances as at 30 April 2010
R
Land and buildings ........................................................................................................... 280 000
Furniture and equipment .................................................................................................. 45 000
Accumulated depreciation: Furniture and equipment ....................................................... 15 000
Debtors control (royalties receivable) ............................................................................... 37 500
Bank (dr) .......................................................................................................................... 6 000
Capital: Chris ................................................................................................................... 76 000
Capital: Brown ................................................................................................................. 73 600
Capital: Rehanna ............................................................................................................. 60 400
Current account: Chris (dr)............................................................................................... 7 400
Current account: Brown (cr) ............................................................................................. 21 600
Current account: Rehanna (cr) ......................................................................................... 19 800
Asset replacement reserve .............................................................................................. 78 000
Creditors control .............................................................................................................. 31 500
2. Additional information:
In preparation for the retirement of Rehanna on 30 April 2010, the following information must be
taken into account:
2.1 The land and buildings were valued at R350 000.
2.2 The partners were advised that the royalties due to them were understated by R50 000.
2.3 As a result of the popularity of the Umbrero song, the partners resolved that goodwill must be
set at R50 000.
2.4 The partners agreed that Rehanna could take a fashionable set of microphones of the
partnership with a carrying amount of R5 700 as partial payment of her account and that the
outstanding balance on her account will be settled in cash at 31 May 2010.
REQUIRED:
2.1 Prepare the valuation account, properly closed off, in the general ledger of
R&B Entertainment. (5)
2.2 Prepare the capital account of Rehanna, properly closed off, in the general ledger
of R&B Entertainment for the year ended 30 April 2010. (7)
2.3 Calculate the profit-sharing ratio of Chris and Brown on 1 May 2010. (4)
[16]
NB: Show all calculations.
6
