Monday, 25 February 2019



Use the information below to answer question 1 and 2.

Ada and Udo are lawyers who went into partnership as Ado and Co. Ada brought cash of ₦12 000, furnishings worth ₦18,000 and a motor vehicle worth ₦70,000. Udo on the other hand brought in cash ₦10 000, his building valued at ₦105 000 and a personal computer worth ₦35 000.

1. What is the capital of Ado & Co.?
A. ₦100 000
B. ₦22 000
C. ₦250 000
D. ₦150 000

2. What is the profit-sharing ratio if it is based on capital contributed by Ada and Udo?
A. 3:2
B. 2:3
C. 1:2
D. 2:1

3. One major advantage of a ledger is that it __.
A. is a book of original entry
B. is only accessible to shareholders during liquidation
C. can be used by any type of business
D. removes the need for preparing a balance sheet after each transaction

4. A trial balance is usually prepared by an accountant from account balances in the ledger for the purpose of __.
A. classifying accounts in the ledger
B. identifying the balance sheet items
C. providing a basis for establishing the accountant's competence  
D. testing arithmetical accuracies of the ledger account balances

5. The total of the creditors at the beginning of the year was ₦4 600 and at the end of the year ₦5 250. During the year, ₦26 500 was paid to suppliers and ₦130 was received in discounts from these suppliers. The purchases for the year would be __?
A. ₦27 038
B. ₦26 630
C. ₦27 280
D. ₦27 150

6. Given:  

What is the profit for the period?
A. ₦8 000
B. ₦4 000
C. ₦5 000
D. ₦6 000.

7         Given:                  

In preparing a trial balance from the list of balances given above, what is the total; in debit and credit columns?
A. ₦88,500
B. ₦85,800
C. ₦147,91
D. ₦138,500

8. The purchase of two generators by Hassan Electronics Enterprises should be recorded as ___.
A. a part of capital in the capital account
B. an acquisition of stock
C. an expense in its general office expense account
D. an acquisition of fixed assets

9         Appropriation Account

Determine the net profits of the partnership.
A. ₦6,600
B. ₦4,850
C. ₦9,300
D. ₦4,450

10. Dele and Seun who are in partnership. have decided to convert their business into a limited liability company where both become directors. To convert the __.
A. they will simply continue since there are no new members.
B. the partnership is formally ended and new company books opened
C. computation of goodwill must be done as it is legally required
E. the shares and all other items will be shared equally and not in their former ratios

11. The most convenient cash book used by a petty trader operating in an area where there is no banking facility is __.
A. four column
B. single column
C. two column
D. three column

12. A general journal contains __.
A. date, narration, folio, debit and credit
B. folio, credit. date, debit and sales
C. date, narration, folio. debit and purchases
D. folio, credit. narration. date and discount

Use the information below to answer question 13 and 14.


13. What is the cash balance?
A. ₦12,095
B. ₦12,905
C. ₦12,590
D. ₦12,950

14. Determine the total of the trial balance
A. ₦335,050
B. ₦323,050
C. ₦333,000
D. ₦230,550

15. The value of capital invested by the owners is __.
A. ₦101,000
B. ₦103,000
C. ₦100,000
D. ₦110.000

16. The liabilities of Udo Co. Ltd is
A. ₦177,000
B. ₦180,000
C. ₦110,000
D. ₦181,000

Use the information below to answer questions 17 and 18.

Drawings are always estimated at 60% of capital

17. The trial balance total is __.
A. ₦8 700
B. ₦9 700
C. ₦7 800
D. ₦7 900

18. Compute the amount withdrawn.
A. ₦1 000
B. ₦2 000
C. ₦1 500
D. ₦1 250

19. Zakari started a business in January 2000. He bought a shop costing ₦54,000 and stock worth ₦7,600. Profit for the year amounted to ₦22,100. His closing capital was 73,800.

Zakari's personal drawings amounted to
A. ₦9,900
B. ₦2,300
C. ₦19,500
D. ₦17,100

20. The balance on the provision for depreciation account is   __.
A. deducted from fixed assets on the balance sheet
B. added to fixed assets on the balance sheet
C. added to the current liabilities of the account
D. deducted from the profit and loss account

21. What are the appropriate recording procedures for entries in the trial balance?
A. Ledgers. source documents and trial balance
B. Ledgers, trial balance and source documents
C. Source documents, ledgers and trial balance
D. Cash account, ledgers and trial balance

22. Mr. Bassev purchased a motor vehicle for use in his business and debited the purchases account with the same value. This is an error of __.
A. principle
B. omission
C. original entry
D. commission

23. Accrual accounting differs from cash accounting because it recognizes __.
A. cash and creditors.
B. cash and debtors
C. debtors and creditors
D. prepayment and cash

24. A private company is different from a public company because __.
A. it cannot invite members of the public to subscribe for its shares
B. it does not restrict the right to transfer its shares
C. it can only offer its shares to members of the public for subscription
D. its shares are owned by one person.

25. The receipts and payments of account of a not-for-profit-making organization plays a similar role in profit-making organization as __.
A. a cash account
B. an expenses account
C. a balance sheet
D. an income account

26. Osei, and Yabo were in partnership sharing profits and losses in the ratio of 3:2. On admitting Takwa, the profit and loss sharing ratio was changed to 1:1:1, supposed Takwa paid -₦30 000 for goodwill, this amount would be.
A. debited to goodwill account
B. credited to Takwa's current account
C. credited to the old partners' capital account
D. shared to all the partners’ capital account.

27. Commission-on-turnover is charged on __.
A. savings accounts
B. current accounts only
C. all bank accounts
D. fixed deposit accounts only

28. The medium that enables the ATM to read the account details and process transactions directly with the account held in the bank is the __.
A. smart card
B. computerized account
C. magnetic strip
D. communication network

Use the information below to answer question 29 and 30.
Adodo Enterprises and Loss Account (Extract)

29. If the gross profit margin is 10%, what is the value of the cost of goods sold?
A. ₦90,000
B. ₦10,000
C. ₦110,000
D. ₦105,600

30. If the opening stock is 5% of sales. calculate the purchases.
A. ₦95.600
B. ₦90,600
C. ₦95,000
D. ₦85,000

31. A major cause of discrepancy between bank statement and the cash book that overstates the bank statement balance is the __.
A. direct payment
B. commission paid
C. direct withdrawal
D. interest received

32. The bank charges levied on a current account holder is the charges on __.
A. transactions
B. cash received
C. turnover
D. transfer

33.     Given

Calculate the total of the trial balance.
A. ₦3,450
B. ₦4,300
C. ₦3,500
D. ₦4,250

34. The major feature of a journal is that it has __.
A. six columns. date, particulars, folio, amount, debit and credit
B. four columns, date, particulars, folio and amount
C. three columns, date, particular and folio
D. six columns, date, particulars, folio, debit and credit.

Use the information below to answer question 35 and 36.2016 PRINCIPLES OF ACCOUNT QUESTIONS

35. Find the gross profit.
A. ₦370,000
B. ₦140.000
C. ₦230,000
D. ₦150,000

36. Calculate the net profit.
A. ₦105,000
C. ₦40,000
D. ₦115,000

37. Which of the following items is a capital expenditure?
A. Maintenance of office machine.
B. Purchase of office machinery
C. Purchase of office stationery.
D. Carriage inwards.

38. The corresponding entry of personal accounts found in the debit side of the cash book is to __.
A. credit the ledger.
B. credit real accounts.
C. debit real accounts.
D. debit the ledger.

39. The formula for calculating depreciation using straight line method is __.

40. The major focus of the trading account is to show __. profit.
B. total purchases.
C. gross margin.
D. total sales


1.     A

2.     B

3.     C

4.     D

5.     B

6.     C

7.     A

8.     D

9.     C

10.   B

11.   B

12.   A

13.   B

14.   C

15.   A

16.   B

17.   B

18.   A

19.   B

20.   A

21.   C

22.   A

23.   C

24.   A

25.   C

26.   A

27.   B

28.   A

29.   A

30.   B

31.   A

32.   C

33.   A

34.   D

35.   B

36.   A

37.   B

38.   A

39.   C

40.   C