(a) Explain three differences between a trial balance and a balance sheet.
(b) Explain the following
           (i)        Bank loan;
           (ii)       Bank overdraft;
           (iii)      Standing order;
           (iv)      Credit transfer.

observation

Majority of the candidates attempted this question and performed well in the (a) and poorly in the (b).
The expected answers in (b) are.
(b) (i) Bank Loan: It is amount of money advanced by a bank to a customer. It has a fixed rate of interest. The principal and the interest is repayable on a specified future date.
   (ii) Bank Overdraft: It is a facility granted by a bank to a current account holder. It allows the account holder to draw more money than what is in the account interest is charged on the amount overdrawn.
(iii) Standing Order: It is an instruction by an accountholder to a bank requesting the bank to make payment of specified amount on behalf of the customer at specified intervals.
(iv) Credit transfers: This is a method of payment whereby a debtor authorizes his banker to make-payment directly into the account of a creditor.