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BAC1100-BUSINESS ACCOUNTING 1A-2ND OPP-JULY 2025 |
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nAmlBIA UnlVERSITY
OF SCIEnCE Ano TECHn0L0GY
FACULTYOF COMMERCE, HUMAN SCIENCESAND EDUCATION
DEPARTMENT OF ECONOMICS, ACCOUNTING AND FINANCE
COURSECODE: BACll00S
COURSENAME: BUSINESSACCOUNTING 1A
SESSION:JULY/AUGUST 2025
PAPER:THEORYAND CALCULATIONS
DURATION: 2 HOURS
MARKS: 80
EXAMINER
SECOND OPPORTUNITY EXAMINATION
DR Z. VAN DER WALT
MODERATOR: MRS Y. ANDREW
INSTRUCTIONS
1. Answer ALL the questions on the answer sheet
2. Read all the questions carefully before answering.
3. All questions count for one mark unless otherwise indicated
4. The examination paper consists of 54 questions
5. The use of a non-programmable calculator is allowed
6. There is only one correct option, the shading of more than one
option will be marked as incorrect
7. Make sure to shade your student number correctly
THIS DOCUMENT CONSISTSOF 15 PAGES(Including this front page)
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General Accounting Theory and the Accounting Equation (18 Marks)
1. Which report gives a review of the profitability of a business?
a. Statement of changes in equity
b. Cash flow statement
c. Statement of Financial Position
d. Statement of Profit or loss and other Comprehensive Income
e. None of the above
2. The following are elements of financial statements:
a. Assets, Liabilities, Capital, Income and Expenses
b. Assets, Liabilities, Owners' Equity, Income and Expenses
c. Assets, Creditors, Owners' Equity, Income and Expenses
d. Assets, Liabilities, Capital, Sales and Expenses
e. None of the above
3. The Concept "Timeliness" means:
a. To have information available to decision makers in time for them to be
capable of influencing the decisions.
b. To prepare the financial statements within a month after the financial year
end.
c. Only items related to the financial year should be included in the financial
statements
d. Transactions and events should be recognized in the financial period in which
they occur and not when cash or cash equivalents are received or paid
e. None of the above
4. Which of the following is a fundamental characteristic of financial
statements:
a. Relevance
b. Comparability
c. Timeliness
d. Verifiability
e. None of the above
5. The enhancing qualitative characteristics of financial statements include
a. Understandability and faithful representation
b. Relevance and faithful representation
c. Relevance and timeliness
d. Comparability and understandability
e. None of the above
6. The definition of accounting includes the following aspects. Which one of
the following options is incorrect?
a. Writing up
b. Recording
c. Measuring
d. Interpreting
e. None of the above
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7. What are the characteristics of management accounting information?
Which one of the following is incorrect?
a. Information is primarily historical based
b. Not regulated by any accounting body
c. To provide information that helps managers make informed decisions about
planning, controlling, and coordinating business operations.
d. Management accounting emphasizes providing relevant information to
decision-making, even if this means including information that is not strictly
financial in nature.
e. None of the above
8. The accounting equation cannot be expressed as:
a. Assets = Owners' equity plus Liabilities
b. Owners' Equity = Assets less Liabilities
c. Liabilities = Assets less owners' equity
d. Owners' Equity= Assets plus liabilities
e. None of the above is incorrect
9. The owner contributes capital to the business, which was deposited in the
bank account. How will this transaction influence the accounting equation (2
marks)
a. Increase in assets and increase in owners' equity
b. Increase in owners' equity and a decrease in assets
c. Increase in assets only
d. Increase in owners' equity and a decrease in liabilities
e. None of the above
10. The business paid rent via EFT. How will this transaction influence the
accounting equation (2 marks)
a. Decrease in owners' equity and increase in assets
b. A decrease in owners' equity and a decrease in assets
c. Decrease in liabilities and decrease in assets
d. Increase in liabilities and decrease in owners' equity
e. None of the above
11. The business purchased goods on credit. How will this transaction influence
the accounting equation (2 marks)
a. Increase in assets and increase in owners' equity
b. Increase and decrease in owners' equity
c. Increase in liabilities and increase in assets
d. Increase in owners' equity and decrease in liabilities
e. None of the above
12. The business obtained a loan from FNB to buy a delivery vehicle. How will
this transaction influence the accounting equation (2 marks)
a. Increase in assets and increase in liabilities
b. Decrease in liabilities and increase in assets
c. Increase in owners' equity and decrease in liabilities
d. Decrease in liabilities and decrease in assets
e. None of the above
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13. The business made a payment on a loan. How will this transaction influence
the accounting equation (2 marks)
a. Increase in assets and increase in liabilities
b. Increase and decrease in assets
c. Increase in owners' equity and a decrease in liabilities
d. A decrease in liabilities and a decrease in assets
e. None of the above
Value Added Tax Theory (8 Marks)
14. Which one of the following is a zero-rated VAT supply?
a. Motor oil
b. Fuel purchased by a service station
c. A Kentucky meal to an Angolan customer
d. A Spur burger to a NUST student
e. None of the above.
15. Which one of the following is not a taxable VAT supply?
a. Renting a flat for residential purpose.
b. Bank Charges charged by bank Windhoek.
c. Spur burger to a South African passport holder
d. A fishing rod bought to do some weekend fishing.
e. None of the above
16. Which one of the following forms of transport is a zero-rated taxable supply?
a. Travelling with the school bus to Katima Mulilo
b. Travelling with Fly Namibia to Johannesburg
c. Travelling with a shuttle to Keetmanshoop
d. Travelling by car to a guest farm
e. None of the above
17. Which one of the following is a zero-rated VAT supply?
a. Motor oil sold to a Namibian customer
b. Salaries paid to employees
c. Direct exports to Zimbabwe
d. Indirect exports to Botswana
e. None of the above.
18. Which one of the following is not a taxable VAT supply?
a. Bank Charges appearing on the bank statement
b. Direct Exports to a Kenyan citizen
c. Furniture bought for an office
d. Salaries and wages to employees
e. None of the above
19. Which of the following statements regarding VAT is correct?
a. VAT on purchases is known as Input VAT
b. Vat on sales is known as Input VAT
c. VAT on purchases is known as Output VAT
d. Vat on sales is known as Output VAT
e. Options a and d
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20. Which of the following statements regarding VAT is incorrect?
a. Input VAT can be claimed back from NamRA
b. Output VAT can be claimed back from NamRA
c. Output VAT has to be paid over to NamRA
d. When the input VAT exceeds the output VAT, a refund from NamRA is
applicable.
e. None of the above
21. Which one of the following is a standard-rated VAT supply?
a. Doctors' consultation fees
b. Medicine purchased at the pharmacy
c. Fuel purchased for the delivery vehicle
d. Interest paid to the bank on an overdraft
e. None of the above.
Books of First Entry and VAT -Application (5 marks)
Questions 22-26. Trump and Musk Enterprises (T&M), a Namibian retailer, sell
electronic parts to the local and international markets. T&M is registered for VAT in
Namibia and includes VAT in the prices where applicable. All suppliers are registered
for VAT and price their products, including VAT. The following transactions took place
during the first two weeks of March 2025. All suppliers and customers are local unless
otherwise stated.
Required:
Choose the option that reflects the correct entry in the books of first entry.
22. Owners made an additional capital contribution of N$575,000. This amount
was deposited in the bank account.
a. Cash Receipt Journal
Date Details VAT
Sales
1
Capital
75000
b. Cash Receipt Journal
Date Details VAT
Sales
1
Capital
c. Cash Payment Journal
Date Details VAT
Purchases
1
Capital 75,000
d. Cash Receipt Journal
Date Details VAT
Sales
1
Capital
e. None of the above is correct
Debtors
Debtors
Credito
rs
Debtors
Sundries
Account
Capital
Sundries
Account
Capital
Sundries
Name
T&M
Sundries
Account
T&M
Sundries
N$
500,000
Sundries
N$
575,000
Sundries
N$
500,000
Sundries
N$
575,000
Bank
575,000
Bank
575,000
Bank
575,000
Bank
575,000
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23. T&M sells products to local customers for N46,000. The entire amount was
deposited in the bank account.
a. Cash Receipt Journal
Date Details
2
Sales
VAT
6,000
Sales
40,000
Debtors
Sundries
Account
Sales
Sundries
N$
Bank
40,000
b. Sales Journal
Date Customer
2
Customers
Sales
40,000
VAT
6,000
Total
46,000
c. Cash Receipt Journal
Date Details
2
Sales
VAT
6,000
Sales
46,000
Debtors
Sundries
Account
Sundries
N$
Bank
52,000
d. Cash Receipt Journal
Date Details VAT Sales
2
Sales
6,000 40,000
e. None of the above is correct
Debtors
Sundries
Account
Sundries
N$
Bank
46,000
24. T&M purchased electronic parts from Putin CC and received a credit invoice
for N$34,500
a. Purchases Journal
Date Creditor
3
Putin CC
Total
Purchases VAT
34,500 30,000
4,500
Other
Account
Other N$
b. Purchases Journal
Date Creditor
3
Putin CC
Total
Purchases VAT
34,500 34,500
Other
Account
Other N$
c. Cash Payment Journal
Oat Detail
es
3 Putin
cc
VAT
4,500
Purchases Creditors Sundries
Name
30,000
Sundries
N$
Bank
34,500
d. Cash Payment Journal
D Details
VAT Purchases Creditors Sundries
at
Name
e
3 Purchases
34,500
Sundr Bank
ies N$
34,500
e. None of the above
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25. Zelensky Electronics purchased electronic parts from T&M on credit. Invoice
number A001 for N$23,000 was issued.
a. Sales Journal
Date Customer
4
Zelensk Electronics
Sales
VAT
23,000
Total
23,000
b. Sales Journal
Date Customer
4
Zelensk Electronics
Sales
20,000
VAT
3,000
Total
23,000
C. Purchases Journal
Date Creditor
4
Zelensky
Electronics
Total
23,000
Purchases VAT
20,000
3,000
Other
Account
Other N$
d. Cash Receipt Journal
Date Details
VAT
4
Zelensky 3,000
Electronics
Sales
20,000
Debtors
Sundries
Account
Sundries
N$
Bank
23,000
e. None of the above
26. T&M sells products on credit to Cyril IT, an RSA retailer and issued invoice
number A002 for N$11,500. The goods were exported via road freight.
a. Sales Journal
Date Customer
5
C ril IT
Sales
10,000
VAT
1,500
Total
11,500
b. Cash Receipt Journal
Date Details
5
Cyril IT
VAT
1,500
Sales
10,000
Debtors
Sundries
Account
Sundries
N$
Bank
11,500
c. Sales Journal
Date Customer
5
C ril IT
Sales
VAT
11,500
Total
11,500
d. Cash Payment Journal
Date Details VAT
5
Cyril IT
e. None of the above
Purchases
Creditors
Sundries
Name
Sales
Sundries
N$
11,500
Bank
11,500
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General ledger application (9 Marks)
This information relates to Questions 27,28 and 29. You are given the following totals
of the books of first entry for HAZE CC. In addition, the following accounts had opening
balances as of 1st April 2025.
Positive bank
balance
Suppliers
N$39,000 Customers
N$9,000
N$3,900 Value Added Tax N$5,000
debit
Purchase Journal
Suppliers
N$27,000
Purchases
N$21,869.57
Stationery
Value Added Tax
N$1,739.14
N$3,391.29
Sales Journal
Customers
Sales
N$32,000
Value Added Tax N$4, 173.91
N$27,826.09
Cash Receipt Journal
Customers
N$17,000
Sales
N$10,434.78
Value Added Tax
Bank
N$1,565.22
N$29,000
Cash Payment Journal
Bank
N$40,350 Value Added Tax
N$1,350
Suppliers
N$20,000 Purchases
N$5,000
Rent Paid
N$4,000 Salaries and Wages N$10,000
27. You are required to use the information provided and show the VAT account
for April 2025 (5 marks)
Option a:
Value-Added Tax
1April Balance
30
Suppliers
clo 5,000.00 30 April Customers
PJ1 3,391.29
Bank
SJ1 4,173.91
CRJ1 1,565.22
Bank
Option b:
1April Balance
30
Customers
Bank
CPJ1 1350.00
9,741.29
Value-Added Tax
Balance
clo 5,000.00
SJ1 4,173.91
CRJ1 1,565.22
30 April Bank
Suppliers
Balance
bid 4,002.16
9,741.29
CPJ1 1,350.00
PJ1 3,391.29
bid 5,997.84
Option c:
30
April
Suppliers
Bank
Balance
10,739.13
Value-Added Tax
PJ1 3,391.29 1 April Balance
CPJ1 1,350.00 30 April Customers
bid 5,997.84
Bank
10,739.13
bid 5,000.00
SJ1 4,173.91
CRJ1 1,565.22
10,739.13
10,739.13
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Option d:
1April Balance
30
Customers
Value-Added Tax
clo 5,000.00 30 April Suppliers
PJ1 3,391.29
Bank
SJ1 4,173.91
CRJ1 1,350.00
Bank
CPJ1 1,565.22
9,741.29
Option e: None of the above
Balance
bid 4,002.16
9,741.29
28. You are required to use the information provided and show the "Bank"
account for the month, indicating the closing balance as of the end of April
2025 (4 marks)
Option a
Bank
30 April
Option b
Total
receipts
Balance
CRJ1 29,000.00 1 April
bid 37,650.00 30
66,650.00
Bank
Balance
clo
Total payments bid
39,000.00
27,650.00
66,650.00
30 April Balance clo 39,000.00 1 April Total payments CPJ1 40,350.00
Total
bid 29,000.00 30
Balance
bid 27,650.00
receipts
68,000.00
68,000.00
Option c
Bank
30 April
Option d
Total
payments
CPJ1 40,350.00 30 April Total receipts
40,350.00
Bank
Balance
CRJ1 29,000.00
bid 11,350.00
40,350.00
1 April
Balance c/o
Total
bid
receipts
Option e: None of the above.
39,000.00 30 April Total payments CPJ1 40,350.00
29,000.00
Balance
bid 27,650.00
68,000.00
68,000.00
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29. You are required to use the information provided and show the Sales account
for April 2025 (3 marks)
Option a
Sales
30 April Profit/Loss
Account
Option b
38,260.87 30 April Debtors
38,260.87
Sales
Bank
SJ1 27,826.09
CRJ1 10,434.78
38,260.87
30 April Balance c/d
Option c
38,260.87 30 April
38,260.87
Sales
Credit Sales
Cash Sales
SJ1 27,826.09
CRJ1 10,434.78
38,260.87
30 April Profit/Loss
Account
Option d
38,260.87 30 April Sales
38,260.87
Sales
Bank
SJ1 27,826.09
CRJ1 10,434.78
38,260.87
1 April
Balance
c/d
Option e: None of the above
38,260.87 1 April
38,260.87
Debtors
Bank
SJ1 27,826.09
CRJ1 10,434.78
38,260.87
Trial Balance (5 Marks)
30. A trial balance prepared after taking into account the effect of adjusting
entries is known as:
a. Financial trial balance
b. Adjusted trial balance
c. Post-adjusted trial balance
d. Normal trial balance
e. None of the above
31. What records or books are used when preparing a trial balance
a. Specialised Journals
b. Balance Sheet
c. LedgerAccoun~
d. General Journal
e. None of the above
32. Which of the following errors in the journal entry will not be detected by trial
balance:
a. The debit entry is overstated, but the credit entry is correctly recorded
b. The debit entry is correctly recorded, but the credit entry is overstated
c. The same amount overstates both the debit and credit entries
d. The debit entry is correctly recorded, but the credit entry is understated
e. None of the above
33. Which of the following is placed in the debit column of the trial balance
a. Capital
b. Accounts payable
c. Salaries and wages
d. Loans
e. None of the above
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34. Which of the following is placed in the credit column of the trial balance
a. Purchases
b. Rent expense
C. Furniture
d. Sales
e. None of the above
Bank reconciliation {5 marks)
The following questions assume that the bank reconciliation commences with the
closing balance on the bank statement.
35. On the bank statement, cash deposited is shown as a?
a. Credit entry
b. Debit entry
c. Expense
d. Profit
e. None of the above is correct
36. A debit order for Paratus (wifi) for N$450 appears on the bank statement but
not in the cash book. This transaction will be recorded on the:
a. Debit side of the bank account
b. Credit side of the bank account
c. Credit column of the bank reconciliation
d. Debit column of the bank reconciliation
e. None of the above is correct
37. The bank deducted N$150 from the bank statement. This deduction was an
error and should be deducted from another bank client. The error will be
corrected as follows:
a. N$150 will be recorded on the debit side of the bank account
b. N$150 will be recorded on the credit side of the bank account
c. N$150 will be recorded in the debit column of the bank reconciliation
d. N$150 will be recorded in the credit column of the bank reconciliation
e. None of the above is correct
38. The debit side of the bank statement relates to:
a. Deposits
b. Payments
c. Opening balances
d. Errors made by the bank
e. None of the above is correct
39. Interest received on an investment that appears on the bank statement will
be entered as follows:
a. Debit the bank account
b. Credit the bank account
c. On the debit column of the bank reconciliation
d. On the credit column of the bank reconciliation
e. None of the above
40. Which of the following statements is incorrect?
a. A credit balance in the bank statement indicates more deposits than
withdrawals.
b. Bank charges increase a debit balance on the bank statement
c. A bank reconciliation is not part of the bank statement
d. The business prepares a bank statement
e. None of the above
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Year-end adjustments (30 Marks)
You are provided with a list of balances for HAZE CC as on 30 April 2025.
Capital
406,800
Drawings
80,000
Land and Buildings at cost
440,000
Motor Vehicles at cost
180,000
Accumulated depreciation: Motor
36,000
Vehicles
Inventory (1/5/2024)
100,000
Customers
90,000
Suppliers
80,000
Positive Bank Balance
50,000
18% Mortgage bond on the land and
240,000
buildings
Sales
712,400
Interest paid on mortgage
21,600
Purchases
420,000
Salaries and Wages
180,000
Telephone
2,560
Insurance
9,000
Stationery
1,440
Advertising
9,800
Rent Received
66,000
Notes:
• A further debt of N$1,000 has to be written off.
• The interest on the bond has not fully been accounted for. The bond was
registered in 2019.
• The rent was only received for 11 months.
• The telephone account of N$1,200 is still outstanding
• Depreciation on motor vehicles is charged using the straight line method for
over 5 years. No residual value is applicable.
• Inventory as per the inventory count on year-end is presented as N$80,000.
41. The cost of Sales will be calculated as (3 marks)
a. N$440,000
b. N$520,000
c. N$420,000
d. N$96,200
e. None of the above is correct
42. The interest payable on the bond will have the following effect on the
financial statements (2 marks)
a. Total expense is N$21,600, and an accrued expense of N$57,600 is raised
b. Total expense is N$43,200, and an accrued expense of N$21,600 is raised
c. Total expense is N$79,200.
d. Total expense is N$43,200, and an accrued income of N$21,600 is raised
e. None of the above is correct
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43. The adjustment relating to the telephone expense will have the following
effect on the financial statements (2 marks)
a. The total expense is N$2,560, and an accrued expense of N$1,200 is raised
b. The total expense is N$3,760, and a prepaid expense of N$1,200 is raised
c. Total expense is N$2,560
d. Total expense is N$3,760, and an accrued expense of N$1,200 is raised
e. None of the above is correct.
44. The adjustment relating to rent received will have the following effect on the
financial statements (2 marks)
a. The total income is N$72,000, and an accrued income of N$6,000 will be raised
b. Total income is N$66,000
c. Total income is N$72,000, and an income received in advance of N$6,000 will
be raised
d. Total income is N$60,000
e. None of the above is correct.
45. The following statement is correct regarding the motor vehicles as at the end
of the book year (3 marks)
a. The depreciation charge on motor vehicles for 2025 is N$36,000, the
accumulated depreciation as on 30 April 2025 is N$72,000, and the net book
value is N$108,000
b. The depreciation charge on motor vehicles for 2025 is N$9,000, the
accumulated depreciation as on 30 April 2025 is N$27,000, and the net book
value is N$63,000
c. The depreciation charge on motor vehicles for 2024 was N$36,000, the
accumulated depreciation as on 30 April 2025 is N$36,000, and the net book
value is N$72,000
d. The depreciation charge on motor vehicles for 2024 was N$14,000, the
accumulated depreciation is N$14,000, and the net book value is N$54,000
e. None of the above
46. According to the information provided, the motor vehicle was purchased in
the ...... financial year
a. 2022
b. 2023
C. 2024
d. 2025
e. None of the above
47. The current assets section will be shown as follows (4 marks)
a. N$225,000
b. N$110,000
c. N$169,000
d. N$220,000
e. None of the above
48. The current liabilities will be shown as follows (3 marks)
a. N81,200
b. N$80000
c. N$102,800
d. N$43,200
e. None of the above
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49. How much is the gross income if a cost of sales of N$430,000 is assumed (3)
a. N$354,400
b. N$348,400
c. N$288,400
d. N$282,400
e. None of the above
50. Which one of the options below, showing different accounts, will appear in
the Statement of Financial Position?
a. Bank, Cash, Motor Vehicles, Accrued Expenses
b. Suppliers, Debtors, Sales
c. Inventory, Bonds, Interest paid on bonds
d. Inventory, Purchases, St;ippliers
e. None of_the above optio~s is correct
51. Which one of the options below, showing different accounts, will appear in
the Statement of Profit or Loss?
a. Bank, Cash, Motor Vehicles, Sales
b. Inventory, Interest paid on bonds, Investments
c. Sale~·.Purchas·~s;Rerit received
d. Sale~, P.u~bhases:1nvestments
e. None of the above options is correct
52. Accrued expenses will have the following effect on the financial statements
(2 marks)
a. Increase the expense in the Statement of Profit or Loss and increase liabilities
b. Increase the expense in the Statement of Profit or Loss and decrease liabilities
c. Decrease the expense in the Statement of Profit or Loss and increase assets.
d. Decrease the expense in the Statement of Profit or Loss and increase liabilities
e. None of the above
53. Accrued income will have the following effect on the financial statements (2
marks)
a. Increase the income in the Statement of Profit or Loss and increase liabilities.
b. Increase the income in the Statement of Profit or Loss, and increase assets
c. Decrease the income in the Statement of Profit or Loss and increase assets
d. Decrease the income in the Statement of Profit or Loss and increase liabilities.
e. None of the above
54. Which one of the following options illustrates the accounting cycle?
a. Transaction, Source Documents, General ledgers, Books of First Entry, Trial
Balance, Financial Statements
b. Source Documents, Books of First Entry, Transactions, General Ledgers, Trial
Balance, Financial Statements
c. Transaction, Source Documents, Books of First Entry, General ledgers, Trial
Balance, Financial Statements
d. Transaction, Source Documents, General ledgers, Books of First Entry, Trial
Balance, Financial Statements
e. None of the above
End of the examination paper
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