ESTUDYR
FAC1501 Transaction Classification
Assignment 2026
Instructions: For each transaction, select the correct account classification. Correct answers are
highlighted. Rationales explain the logic behind each answer.
Section A: Transactions and Account Classification
(Questions 1–50)
Question 1
On 3 January 2021, SA Landscapers paid SA Media to place an advertisement in the local
newspaper. Which account is debited?
A. Bank
B. Advertisement Expense
C. Trade Payables
D. Revenue
Answer: B. Advertisement Expense
Rationale: Payment for advertising reduces profit and is recorded as an expense.
Question 2
The payment for the advertisement is classified as:
A. Current Asset
B. Expense
C. Current Liability
D. Revenue
Answer: B. Expense
Rationale: Advertising is a cost of operations and reduces net income.
,ESTUDYR
Question 3
SA Landscapers rendered landscaping services to Mrs A Zulu, who paid via EFT. Which account
is debited?
A. Trade Payables
B. Bank
C. Revenue
D. Loan
Answer: B. Bank
Rationale: Cash inflow from the client increases the bank account (current asset).
Question 4
The EFT received from Mrs A Zulu is classified as:
A. Expense
B. Current Asset
C. Revenue
D. Current Liability
Answer: B. Current Asset
Rationale: Cash received is a liquid asset, part of current assets.
Question 5
On 3 January 2021, SA Landscapers received an invoice from SA Media for an advertisement
placed on 20 December 2020. Which account is credited?
A. Trade Payables / Creditors
B. Bank
C. Revenue
D. Loan
Answer: A. Trade Payables / Creditors
Rationale: Invoice received but unpaid creates a liability until payment.
Question 6
, ESTUDYR
Invoices received for services to be paid within 30 days are classified as:
A. Current Assets
B. Current Liabilities
C. Expenses
D. Revenue
Answer: B. Current Liabilities
Rationale: Obligations to pay within 12 months are current liabilities.
Question 7
On 3 January 2021, SA Landscapers obtained a 5-year loan from ZAR Bank. Which account is
credited?
A. Bank
B. Long-term Loan
C. Trade Payables
D. Revenue
Answer: B. Long-term Loan
Rationale: Loans repayable after 12 months are non-current liabilities.
Question 8
The portion of a 5-year loan due within 12 months is classified as:
A. Current Liability
B. Current Asset
C. Revenue
D. Expense
Answer: A. Current Liability
Rationale: Only the short-term portion of the loan is a current liability.
Question 9
Payment to suppliers for services received is classified as:
FAC1501 Transaction Classification
Assignment 2026
Instructions: For each transaction, select the correct account classification. Correct answers are
highlighted. Rationales explain the logic behind each answer.
Section A: Transactions and Account Classification
(Questions 1–50)
Question 1
On 3 January 2021, SA Landscapers paid SA Media to place an advertisement in the local
newspaper. Which account is debited?
A. Bank
B. Advertisement Expense
C. Trade Payables
D. Revenue
Answer: B. Advertisement Expense
Rationale: Payment for advertising reduces profit and is recorded as an expense.
Question 2
The payment for the advertisement is classified as:
A. Current Asset
B. Expense
C. Current Liability
D. Revenue
Answer: B. Expense
Rationale: Advertising is a cost of operations and reduces net income.
,ESTUDYR
Question 3
SA Landscapers rendered landscaping services to Mrs A Zulu, who paid via EFT. Which account
is debited?
A. Trade Payables
B. Bank
C. Revenue
D. Loan
Answer: B. Bank
Rationale: Cash inflow from the client increases the bank account (current asset).
Question 4
The EFT received from Mrs A Zulu is classified as:
A. Expense
B. Current Asset
C. Revenue
D. Current Liability
Answer: B. Current Asset
Rationale: Cash received is a liquid asset, part of current assets.
Question 5
On 3 January 2021, SA Landscapers received an invoice from SA Media for an advertisement
placed on 20 December 2020. Which account is credited?
A. Trade Payables / Creditors
B. Bank
C. Revenue
D. Loan
Answer: A. Trade Payables / Creditors
Rationale: Invoice received but unpaid creates a liability until payment.
Question 6
, ESTUDYR
Invoices received for services to be paid within 30 days are classified as:
A. Current Assets
B. Current Liabilities
C. Expenses
D. Revenue
Answer: B. Current Liabilities
Rationale: Obligations to pay within 12 months are current liabilities.
Question 7
On 3 January 2021, SA Landscapers obtained a 5-year loan from ZAR Bank. Which account is
credited?
A. Bank
B. Long-term Loan
C. Trade Payables
D. Revenue
Answer: B. Long-term Loan
Rationale: Loans repayable after 12 months are non-current liabilities.
Question 8
The portion of a 5-year loan due within 12 months is classified as:
A. Current Liability
B. Current Asset
C. Revenue
D. Expense
Answer: A. Current Liability
Rationale: Only the short-term portion of the loan is a current liability.
Question 9
Payment to suppliers for services received is classified as:
