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JAMB Principles of Accounts 2001 Question 13

Question 13

Accounting Concepts and Conventions

If a property developing company sells a completed building to an interested third party, this sale can be treated in the books of the company as

  1. A.capital receipt
  2. B.revenue receipt
  3. C.windfall receipt
  4. D.miscellaneous receipt.
Show the answer and explanation

Answer: B (revenue receipt)

Explanation

Building and selling houses is the developer's normal trade, so the sale proceeds are revenue receipts.