Started on Friday, 16 June 2023, 2:52 PM
State Finished
Completed on Friday, 16 June 2023, 4:52 PM
Time taken 2 hours
Marks 40.61/65.00
Grade 62.48
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Question 1
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Question text
On 1 September 20.18 Mr Will Turner started a new blacksmith business called Iron Duke. Iron Duke manufactures and sells domestic cast iron furniture. The following transactions took place during the first financial year of the entity ending 31 August 20.19.
On 1 September 20.18 the owner, Mr Will Turner, made the following capital contributions:
• Firstly, he invested a cash amount of R100 000 from his personal savings account into the business bank account.
• He then made his new personal machine, the Belt Grinder, available to the business. The cost of the Belt Grinder was R15 000.
• He also contributed his personal delivery van which had cost R45 000 when new. The vehicle was bought on 1 September 20.16 by Mr Will Turner and had a
carrying value of R27 000 on 1 September 20.18 with only 3 years useful life remaining.
Show the effect of each transaction on the basic accounting equation with a plus sign (+) for an increase and a minus sign (-) for a decrease next to each amount under each element. Also indicate the account(s) that will be affected by each transaction next to the affected elements for the financial year ended 31 August 20.19. (The business makes use of the perpetual inventory system.)
Instructions:
Drag the correct answer into the correct space. An option can be used more than once.
If an options has been provided and it is not applicable to the specific questions please put N/A in the accounts column and a 0 in the amounts column.
Keep the transactions strictly in the order they were given.
Your answer is correct.
Question 2
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Indicate whether the following statement is true or false:
A disadvantage of using a single-entry bookkeeping system is that a single- entry system leads to incomplete records, since the double-entry principle, which requires that for each debit there must be a corresponding credit entry, cannot be applied where only personal accounts are accounted for.
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