O-LevelAccountingPreparation of financial statementsOct/Nov 2018Paper 1 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
The correct answer is D. This question tests the candidate's understanding of preparation of financial statements within the Accountingsyllabus. The examiner's mark scheme requires...
📋 Examiner Report & Trap Analysis
Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...
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