FAC 1503 - Unit 5 Exam Questions with Correct Answers Latest Update 2025/2026
Four things to consider when making a double-entry transaction - Answers Think about effect of
entry on BAE
Identity components involved
Determine which increase and which decrease
Be sure amounts are equal
First step in accounting cycle - Answers Completion of a source document
Two thing transactions may do - Answers Create income or create expense
Affect assets/equity/liabilities
Transactions that affect only assets, equity and liabilities - Answers Capital contributions
Getting a loan
Purchase an asset for cash
Buying asset on credit
Payments to creditors
Withdrawals by owner
Transactions that affect income and expenditure - Answers Income
Expenditure
Income in form of credit
Expenditure in form of credit
Transaction that only affects assets - Answers Receiving payment from debtor
Subtract withdrawals from this category - Answers Capital
General ledger - Answers Contains transactions of assets, equity and liabilities
The contra ledger account - Answers The other ledger account in the transaction
Steps to take when recording a transaction - Answers Identify the amounts involved
Determine which accounts to involve and how
Ensure amounts are equal
Four things to consider when making a double-entry transaction - Answers Think about effect of
entry on BAE
Identity components involved
Determine which increase and which decrease
Be sure amounts are equal
First step in accounting cycle - Answers Completion of a source document
Two thing transactions may do - Answers Create income or create expense
Affect assets/equity/liabilities
Transactions that affect only assets, equity and liabilities - Answers Capital contributions
Getting a loan
Purchase an asset for cash
Buying asset on credit
Payments to creditors
Withdrawals by owner
Transactions that affect income and expenditure - Answers Income
Expenditure
Income in form of credit
Expenditure in form of credit
Transaction that only affects assets - Answers Receiving payment from debtor
Subtract withdrawals from this category - Answers Capital
General ledger - Answers Contains transactions of assets, equity and liabilities
The contra ledger account - Answers The other ledger account in the transaction
Steps to take when recording a transaction - Answers Identify the amounts involved
Determine which accounts to involve and how
Ensure amounts are equal
