FAC1601 EXAM QUESTIONS WITH
COMPLETE 100% ANSWERS 2024
Question 1:
Company XYZ acquired equipment costing $50,000 on 1 January 2023. The equipment is
expected to have a useful life of 5 years with no residual value. Calculate the annual
depreciation expense using the straight-line method.
Answer:
Straight-line depreciation expense = (Cost - Residual Value) / Useful Life
= ($50,000 - $0) / 5
= $10,000 per year
Question 2:
Company ABC had an opening balance of retained earnings of $120,000. During the year,
the company reported a net income of $30,000 and paid dividends of $10,000. What is the
closing balance of retained earnings?
Answer:
Closing Retained Earnings = Opening Retained Earnings + Net Income - Dividends
= $120,000 + $30,000 - $10,000
= $140,000
Question 3:
A company has total assets of $500,000 and total liabilities of $300,000. Calculate the
company's equity.
Answer:
Equity = Total Assets - Total Liabilities
= $500,000 - $300,000
= $200,000
Question 4:
XYZ Ltd. issued 10,000 shares at $5 each. Calculate the amount of capital raised.
Answer:
Capital Raised = Number of Shares × Issue Price per Share
= 10,000 × $5
= $50,000
Question 5:
COMPLETE 100% ANSWERS 2024
Question 1:
Company XYZ acquired equipment costing $50,000 on 1 January 2023. The equipment is
expected to have a useful life of 5 years with no residual value. Calculate the annual
depreciation expense using the straight-line method.
Answer:
Straight-line depreciation expense = (Cost - Residual Value) / Useful Life
= ($50,000 - $0) / 5
= $10,000 per year
Question 2:
Company ABC had an opening balance of retained earnings of $120,000. During the year,
the company reported a net income of $30,000 and paid dividends of $10,000. What is the
closing balance of retained earnings?
Answer:
Closing Retained Earnings = Opening Retained Earnings + Net Income - Dividends
= $120,000 + $30,000 - $10,000
= $140,000
Question 3:
A company has total assets of $500,000 and total liabilities of $300,000. Calculate the
company's equity.
Answer:
Equity = Total Assets - Total Liabilities
= $500,000 - $300,000
= $200,000
Question 4:
XYZ Ltd. issued 10,000 shares at $5 each. Calculate the amount of capital raised.
Answer:
Capital Raised = Number of Shares × Issue Price per Share
= 10,000 × $5
= $50,000
Question 5:
