POST UTME BELLS UNIVERSITY 2023 Accounting | Objective

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Question 1
A company uses the perpetual inventory system. On January 1, 2023, it had 1,000 units of a product in stock, costing ₦50 each. During the year, 500 units were sold, and 200 units were purchased at ₦60 each. The company uses the weighted average method to value inventory. What is the total cost of goods sold for the year?
A. ₦25,000
Correct B. ₦30,000
C. ₦35,000
D. ₦40,000

Correct Answer: B

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Question 2
A manufacturing company produces two products, A and B. Product A requires 2 hours of direct labor and 1 hour of indirect labor, while product B requires 3 hours of direct labor and 2 hours of indirect labor. If the company produces 100 units of product A and 50 units of product B, what is the total direct labor cost?
A. ₦15,000
B. ₦20,000
Correct C. ₦25,000
D. ₦30,000

Correct Answer: C

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Question 3
A company's trial balance as of December 31, 2022, is as follows: Debit Accounts Payable ₦10,000 Accrued Expenses ₦5,000 Cash ₦20,000 Equipment ₦50,000 Inventory ₦30,000 Prepaid Rent ₦10,000 Salaries Payable ₦8,000 Total ₦123,000 Credit Accounts Receivable ₦25,000 Accrued Revenue ₦12,000 Common Stock ₦100,000 Dividends ₦5,000 Equipment ₦50,000 Notes Payable ₦20,000 Retained Earnings ₦30,000 Total ₦142,000 What is the balance of the Retained Earnings account?
Correct A. ₦30,000
B. ₦35,000
C. ₦40,000
D. ₦45,000

Correct Answer: A

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Question 4
A company's balance sheet as of December 31, 2022, is as follows: Assets Cash ₦20,000 Inventory ₦30,000 Prepaid Rent ₦10,000 Total ₦60,000 Liabilities Accounts Payable ₦10,000 Notes Payable ₦20,000 Total ₦30,000 Equity Common Stock ₦100,000 Retained Earnings ₦30,000 Total ₦130,000 What is the total equity of the company?
Correct A. ₦130,000
B. ₦140,000
C. ₦150,000
D. ₦160,000

Correct Answer: A

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Question 5
A government agency is responsible for collecting taxes and distributing them among various departments. The agency's budget for the year is as follows: Revenue Taxes ₦100,000 Fines ₦20,000 Total ₦120,000 Expenditure Department A ₦30,000 Department B ₦40,000 Department C ₦50,000 Total ₦120,000 What is the balance of the agency's budget?
Correct A. ₦0
B. ₦10,000
C. ₦20,000
D. ₦30,000

Correct Answer: A

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Question 6
A company has the following transactions in its cash book: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | 1 Jan | Cash received from customers | 10,000 | 0 | | 2 Jan | Cash paid to suppliers | 0 | 5,000 | | 3 Jan | Cash received from customers | 8,000 | 0 | | 4 Jan | Cash paid to employees | 0 | 3,000 | What is the balance on the cash account at the end of the period?
Correct A. ₦13,000
B. ₦15,000
C. ₦17,000
D. ₦19,000

Correct Answer: A

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Question 7
A company has the following transactions in its cash book: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | 1 Jan | Cash received from customers | 10,000 | 0 | | 2 Jan | Cash paid to suppliers | 0 | 5,000 | | 3 Jan | Cash received from customers | 8,000 | 0 | | 4 Jan | Cash paid to employees | 0 | 3,000 | What is the balance on the cash account at the end of the period?
Correct A. ₦13,000
B. ₦15,000
C. ₦17,000
D. ₦19,000

Correct Answer: A

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Question 8
A company has the following transactions in its cash book: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | 1 Jan | Cash received from customers | 10,000 | 0 | | 2 Jan | Cash paid to suppliers | 0 | 5,000 | | 3 Jan | Cash received from customers | 8,000 | 0 | | 4 Jan | Cash paid to employees | 0 | 3,000 | What is the balance on the cash account at the end of the period?
Correct A. ₦13,000
B. ₦15,000
C. ₦17,000
D. ₦19,000

Correct Answer: A

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Question 9
A company has the following transactions in its cash book: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | 1 Jan | Cash received from customers | 10,000 | 0 | | 2 Jan | Cash paid to suppliers | 0 | 5,000 | | 3 Jan | Cash received from customers | 8,000 | 0 | | 4 Jan | Cash paid to employees | 0 | 3,000 | What is the balance on the cash account at the end of the period?
Correct A. ₦13,000
B. ₦15,000
C. ₦17,000
D. ₦19,000

Correct Answer: A

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Question 10
A company has the following transactions in its cash book: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | 1 Jan | Cash received from customers | 10,000 | 0 | | 2 Jan | Cash paid to suppliers | 0 | 5,000 | | 3 Jan | Cash received from customers | 8,000 | 0 | | 4 Jan | Cash paid to employees | 0 | 3,000 | What is the balance on the cash account at the end of the period?
Correct A. ₦13,000
B. ₦15,000
C. ₦17,000
D. ₦19,000

Correct Answer: A

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Question 11
A company issued 10,000 shares of ₦ 1 each at a premium of ₦ 2 per share. The company also issued 5% debentures of ₦ 10,000 at 5% discount. Prepare the journal entries to record the issue of shares and debentures.
Correct A. Debit Share Capital ₦ 20,000, Credit Cash ₦ 20,000
B. Debit Share Capital ₦ 10,000, Credit Cash ₦ 10,000
C. Debit Share Capital ₦ 20,000, Credit Cash ₦ 10,000
D. Debit Share Capital ₦ 10,000, Credit Cash ₦ 20,000

Correct Answer: A

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Question 12
The following are the balances of the ledger accounts of a company as at 31st December, 2022: Cash ₦ 50,000, Bank ₦ 20,000, Debtors ₦ 30,000, Creditors ₦ 10,000, Capital ₦ 100,000, Profit ₦ 20,000. Prepare the trial balance.
Correct A. Cash ₦ 50,000, Bank ₦ 20,000, Debtors ₦ 30,000, Creditors ₦ 10,000, Capital ₦ 100,000, Profit ₦ 20,000
B. Cash ₦ 20,000, Bank ₦ 50,000, Debtors ₦ 30,000, Creditors ₦ 10,000, Capital ₦ 100,000, Profit ₦ 20,000
C. Cash ₦ 50,000, Bank ₦ 20,000, Debtors ₦ 10,000, Creditors ₦ 30,000, Capital ₦ 100,000, Profit ₦ 20,000
D. Cash ₦ 20,000, Bank ₦ 50,000, Debtors ₦ 10,000, Creditors ₦ 30,000, Capital ₦ 100,000, Profit ₦ 20,000

Correct Answer: A

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Question 13
A, B and C are partners sharing profits and losses in the ratio 3:2:1. Their respective capital contributions are ₦ 60,000, ₦ 40,000 and ₦ 20,000. Calculate the amount of the profit to be distributed to each partner.
Correct A. A ₦ 36,000, B ₦ 24,000, C ₦ 12,000
B. A ₦ 24,000, B ₦ 16,000, C ₦ 8,000
C. A ₦ 12,000, B ₦ 8,000, C ₦ 4,000
D. A ₦ 8,000, B ₦ 4,000, C ₦ 2,000

Correct Answer: A

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Question 14
A company maintains the following cash book: Date | Particulars | Debit | Credit 31st Dec, 2022 | Cash | ₦ 50,000 | ₦ 20,000 31st Dec, 2022 | Bank | ₦ 20,000 | ₦ 50,000 31st Dec, 2022 | Debtors | ₦ 30,000 | ₦ 10,000 31st Dec, 2022 | Creditors | ₦ 10,000 | ₦ 30,000 Prepare the bank reconciliation statement.
Correct A. Bank Balance ₦ 70,000, Cash Balance ₦ 20,000
B. Bank Balance ₦ 20,000, Cash Balance ₦ 70,000
C. Bank Balance ₦ 50,000, Cash Balance ₦ 20,000
D. Bank Balance ₦ 20,000, Cash Balance ₦ 50,000

Correct Answer: A

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Question 15
A company issued 10,000 shares of ₦ 1 each at a premium of ₦ 2 per share. The company also issued 5% debentures of ₦ 10,000 at 5% discount. Prepare the journal entries to record the issue of shares and debentures.
Correct A. Debit Share Capital ₦ 20,000, Credit Cash ₦ 20,000
B. Debit Share Capital ₦ 10,000, Credit Cash ₦ 10,000
C. Debit Share Capital ₦ 20,000, Credit Cash ₦ 10,000
D. Debit Share Capital ₦ 10,000, Credit Cash ₦ 20,000

Correct Answer: A

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Question 16
A company's accounting policy requires that depreciation be calculated using the straight-line method. The company purchased a machine for ₦120,000 and it is expected to last for 5 years. Calculate the annual depreciation.
Correct A. ₦24,000
B. ₦20,000
C. ₦18,000
D. ₦22,000

Correct Answer: A

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Question 17
A company's trial balance shows the following balances: Accounts Payable ₦150,000, Sales Revenue ₦500,000, Cost of Goods Sold ₦300,000, and Common Stock ₦200,000. Prepare a balance sheet.
Correct A. ₦1,250,000
B. ₦1,200,000
C. ₦1,300,000
D. ₦1,350,000

Correct Answer: A

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Question 18
A company uses the weighted average method to value its inventory. The following data is available: 100 units of item A at ₦20 each, 200 units of item B at ₦30 each, and 300 units of item C at ₦40 each. Calculate the total value of the inventory.
A. ₦14,000
Correct B. ₦16,000
C. ₦18,000
D. ₦20,000

Correct Answer: B

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Question 19
A company's income statement for the year ended December 31, 2022, is as follows: Sales ₦1,500,000, Cost of Goods Sold ₦900,000, Gross Profit ₦600,000, Operating Expenses ₦200,000, and Net Income ₦400,000. Prepare a cash flow statement.
Correct A. ₦1,000,000
B. ₦1,200,000
C. ₦1,300,000
D. ₦1,400,000

Correct Answer: A

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Question 20
A company's balance sheet as of December 31, 2022, is as follows: Cash ₦100,000, Accounts Receivable ₦200,000, Inventory ₦300,000, Property, Plant, and Equipment ₦500,000, and Total Liabilities ₦800,000. Prepare a statement of stockholders' equity.
A. ₦200,000
B. ₦300,000
C. ₦400,000
Correct D. ₦500,000

Correct Answer: D

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Question 21
A company's trial balance shows an error of ₦5,000 due to an incorrect posting of a debit entry. The correct entry should have been a credit of ₦5,000. What is the correct journal entry to rectify this error?
A. Debit Cash ₦5,000, Credit Profit and Loss ₦5,000
Correct B. Debit Profit and Loss ₦5,000, Credit Cash ₦5,000
C. Debit Profit and Loss ₦5,000, Credit Capital ₦5,000
D. Debit Capital ₦5,000, Credit Profit and Loss ₦5,000

Correct Answer: B

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Question 22
A company's bank statement shows a balance of ₦10,000, while the cash book shows a balance of ₦15,000. The bank statement also shows a debit of ₤10,000 for a cheque that has been dishonoured. What is the correct bank reconciliation statement?
A. Bank Overdraft ₤10,000, Cash in Hand ₤10,000
Correct B. Bank Overdraft ₤10,000, Cash in Bank ₤10,000
C. Cash in Hand ₤10,000, Cash in Bank ₤10,000
D. Bank Overdraft ₤10,000, Bank Balance ₤10,000

Correct Answer: B

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Question 23
A company issues 1,000, 10% debentures of ₦10 each. The debentures are redeemable at par after 5 years. What is the annual amortisation of the debentures?
Correct A. ₦10,000
B. ₦15,000
C. ₦20,000
D. ₦25,000

Correct Answer: A

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Question 24
A company's assets are valued at ₦10,000, ₦20,000, and ₦30,000 respectively. The company uses the straight-line method of depreciation. What is the annual depreciation charge?
A. ₦10,000
B. ₦15,000
Correct C. ₦20,000
D. ₦25,000

Correct Answer: C

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Question 25
A company's trial balance shows an error of ₦5,000 due to an incorrect posting of a credit entry. The correct entry should have been a debit of ₦5,000. What is the correct journal entry to rectify this error?
A. Credit Cash ₦5,000, Debit Profit and Loss ₦5,000
Correct B. Credit Profit and Loss ₦5,000, Debit Cash ₦5,000
C. Credit Profit and Loss ₦5,000, Debit Capital ₦5,000
D. Credit Capital ₦5,000, Debit Profit and Loss ₦5,000

Correct Answer: B

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