JAMB Principles of Accounts 2014 past questions and answers

One of the differences between bookkeeping and accounting is that the former

1. A.records data while the latter interprets it.
2. B.is regarded as the language of the business while the latter ascertains its strength.
3. C.interprets data while the latter records it.
4. D.summarises information while the latter communicates it.

The concept which states that revenue should be recognized at the point when the sale is deemed to have been made is

1. A.matching.
2. B.consistency.
3. C.realization.
4. D.going concern.

A cheque of ₦5,000 paid to Suleiman had been correctly entered in the cash book but had not been entered in Suleiman's account. To correct this error, debit Suleiman's account and credit

1. A.cash account.
2. B.bank account.
3. C.suspense account.
4. D.purchases account.

Aduke Motors bought three Toyota Hilux vans on cash at the cost of ₦6,000,000, on debiting the vehicle account, the corresponding credit for the purchase will appear in the

1. A.sales day book.
2. B.purchases day book.
3. C.sales subsidiary book.
4. D.cash book.

Which of the following affects the accuracy and authenticity of the trial balance?

1. A.Error of omission.
2. B.Error of commission.
3. C.Error of transposition.
4. D.Error of original entry.

The book of account in which information from the source documents are recorded consist of

1. A.debit and credit notes.
2. B.ledger and subsidiary books.
3. C.prepayments and accruals.
4. D.profit and loss and balance sheet.

The accounting entries to record a cheque issued by a business is to

1. A.debit cash book and credit drawer.
2. B.credit cash book and debit drawer.
3. C.debit cash book and credit suspense account.
4. D.credit cash book and debit suspense account.

Given:
If Emenike Enterprises settles its suppliers for goods purchased within 7 days, it can earn a cash discount of 12½%. Assuming ₦22,800 worth of goods were purchased and settled within 5 days, what will be the amount to be credited in the cash column of the company's cash book?

1. A.₦25,650.
2. B.₦22,800.
3. C.₦19,950.
4. D.₦18,240.

The major advantage of an imprest system is that it

1. A.ensures a proper accountability for every expenditure.
2. B.trains the young accountants in the preparation for greater responsibilities.
3. C.relieves the chief cashier of the numerous petty cash payments.
4. D.serves as an analysis column for every expenses.

Petty cash book records transactions on

1. A.the debit side only.
2. B.the credit side only.
3. C.both credit and debit sides.
4. D.reversed entry.

A major way by which the headquarters guard against fraud in branches on cash remittance is through the introduction of

1. A.imprest system only.
2. B.direct purchase by branch.
3. C.separate accountant for the branch.
4. D.credit sales by only the headquarters.

I. Cash sales
II. Cash purchases
III. Cash discount allowed
IV. Cash payment
V. Cash receipts
Which of the following are recorded on the debit side of the cash book?

1. A.I and II.
2. B.I and III.
3. C.I and V.
4. D.I and IV.

An item credited in the bank statement but yet to be recorded in the firm's cash book is

1. A.bank loan.
2. B.contract payment.
3. C.standing order.
4. D.direct deposit.

The formula for calculating depreciation using straight line method is

1. A.(Scrap value + Sales)/Useful life.
2. B.(Cost − Scrap value)/Useful life.
3. C.(Sales − Scrap value)/Useful life.
4. D.(Purchases + Sales)/Useful life.

The major focus of the trading account is to show

1. A.net profit.
2. B.gross margin.
3. C.total purchases.
4. D.total sales.

If goods were bought from Tanko at a cost price of ₦9,000 with a cash discount of 5%, how much will be paid assuming prompt payment was made?

1. A.₦4,500.
2. B.₦8,550.
3. C.₦9,000.
4. D.₦9,450.

If machine X cost ₦600,000 with anticipated life span of five years and estimated scrap value of ₦50,000, using straight line method; depreciation charged for two years will be

1. A.₦700,000.
2. B.₦240,000.
3. C.₦220,000.
4. D.₦202,000.

Balance Sheet (Extract)
Creditors ₦7,940
Prepaid expenses ₦290
Accrual expenses ₦323
Stock ₦4,500
Cash balances ₦4,956
Debtors ₦905
The value of the current assets will be

1. A.₦10,361.
2. B.₦10,651.
3. C.₦17,396.
4. D.₦17,848.

Balance Sheet (Extract)
Creditors ₦7,940
Prepaid expenses ₦290
Accrual expenses ₦323
Stock ₦4,500
Cash balances ₦4,956
Debtors ₦905
Determine the current liabilities.

1. A.₦8,553.
2. B.₦8,263.
3. C.₦7,940.
4. D.₦1,228.

The excess of sales over cost of goods sold is

1. A.gross sales.
2. B.gross profit.
3. C.net profit.
4. D.net sales.

2/3 Purchases 900 books at ₦1,000 each
4/3 Purchases 590 books at ₦950 each
15/3 Sales 300 books at ₦900 each
Determine the cost of goods sold using FIFO.

1. A.₦285,000.
2. B.₦300,000.
3. C.₦570,000.
4. D.₦600,000.

The control account is used in facilitating

1. A.the location of errors in the various accounts.
2. B.up to date bank transactions.
3. C.the payment of debts and liabilities of the firm.
4. D.assets distribution with respect to income.

A book of account that possesses the features of both daybook and ledger is

1. A.sales day book.
2. B.cash book.
3. C.purchases day book.
4. D.returns day book.

The value of the sales ledger control account is derived from the summation of

1. A.the total debtors' account.
2. B.the total creditors' account.
3. C.all day books.
4. D.both the debtors' and creditors' accounts.

Subscription in arrears is treated in the balance sheet of a club as

1. A.current asset.
2. B.current liability.
3. C.fixed asset.
4. D.intangible asset.

Maina Merchants Trading and Profit and Loss Account (Extract)
Stock (1/1/2010) ₦80,000
Purchases ₦90,000
Cost of goods available for sale ₦170,000
Stock (31/12/2010) ?
Cost of goods sold ?
Gross profit ₦150,000
Total ₦270,000
Sales ₦300,000; Less returns inwards ₦30,000; ₦270,000
Determine the closing stock.

1. A.₦30,000.
2. B.₦40,000.
3. C.₦50,000.
4. D.₦60,000.

Social Club Subscription (Extract)
31/12/2009 Subscription accrued ₦18,900
Subscription received in advance ₦16,400
Subscription received during the year 2009 ₦38,570
Determine the amount of subscription for the year.

1. A.₦57,470.
2. B.₦41,070.
3. C.₦40,210.
4. D.₦35,300.

Social Club Subscription (Extract)
31/12/2009 Subscription accrued ₦18,900
Subscription received in advance ₦16,400
Subscription received during the year 2009 ₦38,570
What is the amount of subscription to be shown as liability in the balance sheet as at December 2009?

1. A.₦14,200.
2. B.₦16,400.
3. C.₦18,900.
4. D.₦20,500.

Income and Expenditure (Extract)
Debit: Bal. b/d ₦390; Sales of tickets ₦4,000; Donations ₦3,000; Subscriptions ₦6,500
Credit: Expenses on cleaning ₦300; New tool ₦510; Repairs ₦400; Electricity ₦350
What is the total income for the period?

1. A.₦13,890.
2. B.₦13,500.
3. C.₦10,500.
4. D.₦9,500.

Income and Expenditure (Extract)
Debit: Bal. b/d ₦390; Sales of tickets ₦4,000; Donations ₦3,000; Subscriptions ₦6,500
Credit: Expenses on cleaning ₦300; New tool ₦510; Repairs ₦400; Electricity ₦350
What is the balance carried down?

1. A.₦11,680.
2. B.₦11,930.
3. C.₦12,330.
4. D.₦13,430.

Given:
Sales ₦180,000
Stock 1/1 ₦25,000
Purchases ₦110,000
Sales returns ₦1,000
Purchases returns ₦1,500
Gross profit ₦58,000
Determine the value of stock as at 31st December.

1. A.₦8,000.
2. B.₦9,500.
3. C.₦12,500.
4. D.₦15,500.

In a departmental account, the expenses to be apportioned on the basis of turnover is

1. A.carriage inwards.
2. B.returns outwards.
3. C.discount received.
4. D.carriage outwards.

In a departmental account, where no basis of apportionment exist, apportionment is

1. A.on profit basis.
2. B.according to employee decision.
3. C.according to material available.
4. D.on equal basis.

If goods are sent to branch at 25% on cost, what will be the cost of goods sent to the branch at a selling price of ₦100,000?

1. A.₦130,000.
2. B.₦125,000.
3. C.₦80,000.
4. D.₦75 000.

Hussaina Enterprises sent goods worth ₦800,000 at cost plus mark-up of 25% to its branch.
What is the cost price of the goods sent to the branch?

1. A.₦600,000.
2. B.₦620,000.
3. C.₦640,000.
4. D.₦700,000.

Hussaina Enterprises sent goods worth ₦800,000 at cost plus mark-up of 25% to its branch.
Determine the profit on the goods sent to the branch at profit margin of 25% mark-up.

1. A.₦150,000.
2. B.₦160,000.
3. C.₦170,000.
4. D.₦ 180,000.

In the absence of a partnership deed, the act stipulates that

1. A.an amount should be fixed as salary for partners.
2. B.interest on partners loan should be 25%.
3. C.interest should not be allowed on partners drawings.
4. D.profits and losses should not be shared equally.

The profit of a branch is usually credited to the

1. A.adjustment account.
2. B.head office sales account.
3. C.branch office goods account
4. D.head office current account.

Where partnership is converted into a limited liability company, current account balances of partners are transferred to a

1. A.realization account.
2. B.savings account.
3. C.share capital account.
4. D.capital account.

The expenses incurred in purchasing a vehicle is a

1. A.revenue expenditure.
2. B.capital expenditure.
3. C.recurrent expenditure.
4. D.concurrent expenditure.

Payment for shares in excess of amount offered gives rise to

1. A.subscription in advance.
2. B.revenue reserves.
3. C.capital reserves.
4. D.calls-in-advance.

The details of the share capital which a company is authorized to issue is contained in the

1. A.Articles of Association.
2. B.Companies and Allied Matters Act.
3. C.Memorandum of Association.
4. D.Share capital certificate.

Oil and Buns issued to the public 1,300,000 ordinary shares of 75k at a price of ₦1.50k. Application and allotment were received for 900,000 shares at 25k each.
Determine the amount received on application and allotment.

1. A.₦224,950.
2. B.₦225,000.
3. C.₦324,950.
4. D.₦325,000.

Oil and Buns issued to the public 1,300,000 ordinary shares of 75k at a price of ₦1.50k. Application and allotment were received for 900,000 shares at 25k each.
The book value of issued share capital is

1. A.₦675,000.
2. B.₦975,000.
3. C.₦1,350,000.
4. D.₦1,950,000.

The account of government into which all monies are received and from which all expenditures are disbursed is the

1. A.Federation Account.
2. B.Petroleum Technology Development Fund.
3. C.Central Bank Account.
4. D.Development Fund.

In government accounting, the method used which records on the basis of financial entity with self-balancing books instead of entity of proprietorship is

1. A.virement.
2. B.fund accounting.
3. C.consolidated fund.
4. D.financial regulation.