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JAMB Principles of Accounts 2010 Question 26

Question 26

Incomplete Records

31/12/08: Furniture and fittings ₦21 000; Office equipment ₦9 800; Debtors ₦6 800; Creditors ₦4 900; Cash at bank ₦7 000
31/12/09: Furniture and fittings ₦28 000; Office equipment ₦13 200; Debtors ₦5 200; Creditors ₦5 100; Cash at bank ₦4 600; Accrued electricity bills ₦1 200
Monthly drawings averaged ₦330.
Determine the net profit.

  1. A.₦5 000
  2. B.₦3 960
  3. C.₦1 040
  4. D.₦8 960
Show the answer and explanation

Answer: D (₦8 960)

Explanation

Closing capital = 28 000 + 13 200 + 5 200 + 4 600 − 5 100 − 1 200 = ₦44 700. Net profit = 44 700 − 39 700 + drawings (330 × 12 = 3 960) = ₦8 960.