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PRINCIPLES OF ACCOUNTING TEST

1. Bola, UTC’s regular customer, owed N1,00 on account of a radio bought. If he sent in a cheque for N1,500, UTC would send him a

 

 

 

 

2. What are the advantages of an imprest petty cash book? I cheques can be drawn easily II A cheque on the use of cash III Liability of the petty cashier is limited to the value of petty cash IV Loses through the petty cashier can be minimized

 

 

 

 

3. A payment of cash of N20 to John was entered on the receipt side of the cash book in error and credited to John’s account. Which of the following journal entry can be used to correct the error?

 

 

 

 

4. Mallam Gambo bought a freezer for his shop costing N10,500. In recording, he debited office expenses account and credited the bank account. What book-keeping error has he committed?

 

 

 

 

5. From which of the following sources are creditors control account most likely to be posted?

 

 

 

 

6. The following represent extracts from the trading account of a retail outlet for a given month: Opening stock N2,400 Closing stock N6,400 Other expenses N2,000 Sales N11,000 Profit N900 What is the purchase figure for the month?

 

 

 

 

7. Which of the following transaction is BEST recorded in the general journal?

 

 

 

 

8. The amount of individual items on a government budget is called

 

 

 

 

9. Under which of the following conditions is a partnership dissolved?

 

 

 

 

10. which of the following factors has aided the development of accounting?

 

 

 

 

11. When a business incurs labour cost in installing a fixed asset, the cost is treated as

 

 

 

 

12. The suspense account is used to correct book-keeping error where the

 

 

 

 

13. Why are adjustments in the profit and loss account necessary?

 

 

 

 

14. The document setting out the regulations regarding shares, meetings and internal organization of a company is known as

 

 

 

 

15. The financial position of an organization at a particular time can be ascertained from the

 

 

 

 

16. Assigning revenues to the accounting period in which goods were sold or services rendered and expenses incurred is known as

 

 

 

 

17. When is a petty cash account debited?

 

 

 

 

18. An advantage of using accounting ratios is that they

 

 

 

 

19. One major advantage of ledger is that it

 

 

 

 

20. The accounting convention which states that profit must not be recognized until realized while all losses should be adequately provided for it termed

 

 

 

 

21. Given;
Purchases = N20,000
Sales = N40,000
Carriage inwards = N5,000
Carriage outwards = N5,000
Opening stock = N10,000
Closing stock = N5,000

What is the cost of goods sold?

 

 

 

 

22. The term “accounting period” is used to refer to the

 

 

 

 

23. Diamond Ringo business was started when Mr. Diamond brought in a cheque of N500,000, which was paid into the bank account. Which of the following entries properly records the transaction?

 

 

 

 

24. The major distinguishing element between the final accounts of a partnership and a sole trader is the

 

 

 

 

25. A trail balance is usually prepared by an accountant from account balances in the ledger for the purpose of

 

 

 

 

26. If a bad debt previously written off is subsequently repaid, the amount collected is recorded as an

 

 

 

 

27. Which of the following concept stipulates that accounting profit is the difference between revenue and expenses?

 

 

 

 

28. Beginning and ending accounts receivable balances were N8,000 and N15,000 respectively. If collections from customers during the period were N36,000, then total sales on account would be

 

 

 

 

29. The use of the folio in the ledger is for

 

 

 

 

30. The receipt from a special tax levy to pay maturing interest obligation are recorded in

 

 

 

 

31. Adama’s bank account showed an overdraft of N600 on 31st march. On going through the account, it was discovered that the N1,080 paid into the account on 29th March had not been credited. what should be the balance in Adama’s cash accounts?

 

 

 

 

32. The cash bass of accounting requires the recognition of revenue only when they are

 

 

 

 

33. The discount column of a three column cashbook is not balanced off but periodically transferred to the discount account because discounts

 

 

 

 

34. When preparing a bank reconciliation statement, which of the following is deducted from the balance per bank statement?

 

 

 

 

35. Goodwill appears in the books of a business only if it has been

 

 

 

 

36. A limited liability company has an authorized share capital of N50 million split into 100 million shares 80 million share was offered for subscription at 60k per share payable in full on application. These have been fully subscribed and issued What is the issued capital

 

 

 

 

37. A limited liability company has an authorized share capital of N50 million split into 100 million shares 80 million share was offered for subscription at 60k per share payable in full on application. These have been fully subscribed and issued What is the nominal value of each share?

 

 

 

 

38. An effective accounting system should provide information

 

 

 

 

39. The expenditure on a good or services which is consumed either immediately or within a current accounting period is called

 

 

 

 

40. Antics Electronic Company recently bought six generators. Which of the following is the correct method of recording this transaction?

 

 

 

 

41. Accounting information is used by investors and creditors of a company to predict

 

 

 

 

42. The net profit from a trading account of a non-profit making organization would be treated as income in the

 

 

 

 

43. The major difference between the receipt and payment account and the income and expenditure account is that while the former

 

 

 

 

44. Given: Motor van, N3,600, Premises, N5,000; Loan from R. Nwaeke, N1,000; Cash at bank; N1,650; stock of goods N4,800; Creditors, N2,560; Cash in hand, N250 and debtors N6,910. calculate the capital figure.

 

 

 

 

45. when shares issued are paid for, accounting entry required is

 

 

 

 

46. The net profit or loss for the year is determined in profit and loss account after

 

 

 

 

47. What is the cardinal rule of the double entry system?

 

 

 

 

48. Which of the following accounting records are source documents?

 

 

 

 

49. Which of the following categories of labour cost will be classified as direct?

 

 

 

 

50. Kayode, Akpan and Kachalla are in partnership. Their respective capital accounts had the following balances: N40,000, N50,000 and N70,000. The partners agree to admit Wamo as a new partner with a one-fifth interest in the partnership capital in exchange for N50,000 cash. Wamo’s equity in the resulting partnership is

 

 

 

 


Question 1 of 50



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