O-LevelAccountingPreparation of financial statements7707/12 · Oct/Nov 2018 · Q161 Mark
Michael's financial year ends on 31 August. On 30 August 2018 he purchased a motor vehicle using a bank loan which is repayable on 30 August 2020. On 31 August 2018 Michael had a bank overdraft. In which sections of Michael's statement of financial position on 31 August 2018 did these items appear?
Amotor vehicle: current asset; bank loan: current liability; bank overdraft: non-current liability
Bmotor vehicle: current asset; bank loan: non-current liability; bank overdraft: current liability
Cmotor vehicle: non-current asset; bank loan: current liability; bank overdraft: non-current liability
Dmotor vehicle: non-current asset; bank loan: non-current liability; bank overdraft: current liability
✓ Correct answer
D: motor vehicle: non-current asset; bank loan: non-current liability; bank overdraft: current liability
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