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JAMB Principles of Accounts 2005 Question 25

Question 25

Incomplete Records

Use the information below to answer questions 25 and 26.
Zazzau Company
Cash in hand ₦50
Cash in bank ₦1 250
Stock ₦4 880
Furniture ₦960
Building ₦5 500
Debtors ₦1 750
Creditors ₦2 150
Drawings of ₦125 were made by the shareholders of the company.
The capital of the company stands at

  1. A.₦12 240
  2. B.₦12 115
  3. C.₦2 510
  4. D.₦2 150
Show the answer and explanation

Answer: A (₦12 240)

Explanation

Total assets = 50 + 1 250 + 4 880 + 960 + 5 500 + 1 750 = ₦14 390. Capital = 14 390 − creditors 2 150 = ₦12 240; the drawings are already reflected in the balances.