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WAEC Financial Accounting 1994 Question 17

Question 17

Final Accounts of a Sole Trader

Which of the following is a current asset item?

  1. A.Goodwill
  2. B.Bank Overdraft
  3. C.Preliminary expenses
  4. D.Prepayments
  5. E.Outstanding expenses.
Show the answer and explanation

Answer: D (Prepayments)

Explanation

Prepayments are amounts paid in advance: a current asset.