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FAC1601 ASSIGNMENT 1 SEMESTER 2 2024
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This document contains FAC1601 ASSIGNMENT 1 QUESTIONS and ANSWERS.
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FAC1601-24-S2 Welcome Message Assessment 1QUIZ
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Question 1
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In a partnership, if the agreement does not specify the interest on capital, what is the usual practice?
a. The partners negotiate the rate annually.
b. Interest is paid at a fixed statutory rate.
c. Interest on capital is not paid.
d. Interest is paid at the bank's prime rate.
Clear my choice
,Question 2
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Qabaqongo Oils is a sunflower oil production and distribution business, supplying various retailers and wholesalers
throughout Mpumalanga. The company is a partnership between Khanyisa and Zinhle. Below is the relevant information
regarding the partnership’s financial activities for the year ending 30 June 2024.
Extract of balances as at 30 June 2024:
R
Inventory R106,800
Bank (positive) R293,600
Trade receivables control R199,200
Vehicles at cost R708,200
Equipment at cost R209,300
Factory building at cost R575,100
Accumulated depreciation: Vehicles R41,700
Accumulated depreciation: Equipment R68,400
Allowance for credit losses R3,000
Trade payables control R119,800
Capital: Khanyisa R431,500
Capital: Zinhle R246,700
Current account: Khanyisa (Cr: 1 July 2023) R13,300
Current account: Zinhle (Dr: 1 July 2023) R9,400
2. Supplementary information:
2.1 Details of the partnership agreement between the partners:
2.1.1 An annual interest rate of 6% is applied to the opening balances of the partners’ capital and current accounts.
2.1.2 Profits and losses are shared equally between Khanyisa and Zinhle.
2.1.3 The monthly salaries to which the partners are entitled are R15 000 and R20 000 for Khanyisa and Zinhle respectively.
As of 30 June 2024, the salaries paid to the partners were only up to 30 April 2024.
2.2 Adjustments at the end of the year:
2.2.1 The business aimed to expand its operations by acquiring additional land for sunflower cultivation. On 30 June 2024,
KEN Corp provided a loan of R468 000 to facilitate the purchase of a farm. The farmland was acquired on 2 July 2024 at the
cost of R468,000. This loan is classified as long-term, with an 8% annual interest rate, to be repaid over 6 years with equal
instalments starting from 30 June 2025. This transaction has not yet been recorded.
2.2.1 On 30 June 2024, it was decided that an outstanding debt of R17 100 owed to the business was unlikely to be
recovered and should be written off as bad debt.
Assuming that the profit available for distribution to partners amounted to R560 000, which one of the following alternatives
represents the correct balance in the current account of Zinhle on 30 June 2024?
a. R325,966
b. R310,600
c. R44,838
d. R324,944
e. R324,732
f. R524,838
g. R324,838
Clear my choice
, Question 3
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In a partnership, the drawings account(if kept) is debited when a partner withdraws a salary.
True
False
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