Practice Post UTME CALEB UNIVERSITY accounting 2019 Past Questions

Question 1

In a public sector accounting system, what is the primary purpose of the 'Statement of Expenditure'?

A. To record all transactions of the government

B. To report the financial position of the government

Correct C. To show the sources and uses of funds by the government

D. To present the cash and bank balances of the government

Correct Answer: C

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Question 2

A manufacturing company uses the process costing method. The company has two departments: Cutting and Assembly. The Cutting department has a production cost of ₦100,000 and the Assembly department has a production cost of ₦150,000. What is the total production cost of the company?

A. ₦250,000

B. ₦200,000

Correct C. ₦300,000

D. ₦350,000

Correct Answer: C

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Question 3

A company has the following cash book transactions: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | 1/1 | Cash received from customers | 10,000 | 0 | | 1/2 | Cash paid to suppliers | 0 | 5,000 | | 1/3 | Cash received from bank | 8,000 | 0 | | 1/4 | Cash paid to employees | 0 | 12,000 | What is the bank reconciliation statement?

A. ₦18,000

B. ₦22,000

Correct C. ₦28,000

D. ₦32,000

Correct Answer: C

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Question 4

A company has the following control account balances: | Account | Debit | Credit | | --- | --- | --- | | Sales | 100,000 | 0 | | Purchases | 0 | 80,000 | | Cash | 20,000 | 0 | | Bank | 0 | 30,000 | What is the total value of the company's assets?

A. ₦150,000

B. ₦170,000

Correct C. ₦180,000

D. ₦190,000

Correct Answer: C

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Question 5

A company uses the single-entry system of accounting. The company's cash book shows the following transactions: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | 1/1 | Cash received from customers | 10,000 | 0 | | 1/2 | Cash paid to suppliers | 0 | 5,000 | | 1/3 | Cash received from bank | 8,000 | 0 | | 1/4 | Cash paid to employees | 0 | 12,000 | What is the journal entry to record the cash received from customers?

Correct A. Debit: Cash | Credit: Sales

B. Debit: Sales | Credit: Cash

C. Debit: Cash | Credit: Purchases

D. Debit: Purchases | Credit: Cash

Correct Answer: A

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Question 6

A company's accounting policy requires that depreciation be calculated using the straight-line method. However, the company's management has decided to use the reducing balance method for tax purposes. What is the effect of this change on the company's financial statements?

A. The company's net income will increase.

Correct B. The company's net income will decrease.

C. The company's tax expense will increase.

D. The company's tax expense will decrease.

Correct Answer: B

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Question 7

A government agency is required to prepare a cash flow statement in accordance with the accrual basis of accounting. However, the agency's management has decided to prepare the cash flow statement on a cash basis. What is the effect of this change on the agency's financial statements?

A. The agency's net income will increase.

Correct B. The agency's net income will decrease.

C. The agency's cash flow will increase.

D. The agency's cash flow will decrease.

Correct Answer: B

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Question 8

A company has a machine that cost ₦100,000 and has a useful life of 5 years. The machine is depreciated using the straight-line method. What is the annual depreciation expense for the machine?

Correct A. ₦20,000

B. ₦25,000

C. ₦30,000

D. ₦35,000

Correct Answer: A

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Question 9

A government agency has a building that cost ₦500,000 and has a useful life of 10 years. The building is depreciated using the reducing balance method. What is the annual depreciation expense for the building?

Correct A. ₦50,000

B. ₦55,000

C. ₦60,000

D. ₦65,000

Correct Answer: A

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Question 10

A company has a cash book that shows a balance of ₦100,000. However, the company's bank statement shows a balance of ₦120,000. What is the reason for the difference?

A. The company has deposited cash into the bank.

Correct B. The company has withdrawn cash from the bank.

C. The company has made a mistake in the cash book.

D. The company has made a mistake in the bank statement.

Correct Answer: B

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Question 11

The management of a public sector organization is considering the adoption of a new accounting system. The system will use a combination of manual and computerized processes. What is the primary advantage of this hybrid system?

A. Improved accuracy

B. Enhanced security

Correct C. Increased efficiency

D. Reduced costs

Correct Answer: C

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Question 12

A company has two departments: Manufacturing and Sales. The Manufacturing department has a machine that depreciates by 10% per year. If the initial cost of the machine is ₦120,000, what is its value after 3 years?

A. ₦90,000

Correct B. ₦108,000

C. ₦110,000

D. ₦100,000

Correct Answer: B

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Question 13

A partnership has two partners: John and Mary. John invests ₦50,000 and Mary invests ₦30,000. If the profit is divided in the ratio 2:1, how much will John receive?

A. ₦40,000

Correct B. ₦60,000

C. ₦80,000

D. ₦100,000

Correct Answer: B

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Question 14

A company uses the double entry system to record its transactions. If the company purchases goods worth ₦100,000 on credit, what is the effect on the accounting equation?

A. Assets increase, Liabilities increase

Correct B. Assets increase, Liabilities decrease

C. Assets decrease, Liabilities increase

D. Assets decrease, Liabilities decrease

Correct Answer: B

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Question 15

A company has a ledger account with the following transactions: Debit: ₦10,000, Credit: ₦5,000. What is the net effect on the account?

Correct A. ₦5,000 debit

B. ₦5,000 credit

C. ₦10,000 debit

D. ₦10,000 credit

Correct Answer: A

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Question 16

A company's accounting records show that its total assets increased by ₦120,000 and its total liabilities decreased by ₦80,000 during the year. Calculate the net change in the company's equity.

Correct A. ₦40,000

B. ₦60,000

C. ₦80,000

D. ₦100,000

Correct Answer: A

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Question 17

A manufacturing company produces two products, X and Y. Product X requires 2 hours of direct labor and 1 hour of indirect labor, while product Y requires 3 hours of direct labor and 2 hours of indirect labor. If the company produces 100 units of product X and 50 units of product Y, calculate the total direct labor hours and total indirect labor hours.

Correct A. Direct labor: 350 hours, Indirect labor: 150 hours

B. Direct labor: 200 hours, Indirect labor: 100 hours

C. Direct labor: 300 hours, Indirect labor: 200 hours

D. Direct labor: 400 hours, Indirect labor: 300 hours

Correct Answer: A

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Question 18

A company's trial balance shows the following accounts: Accounts Payable ₦150,000, Accounts Receivable ₦200,000, Common Stock ₦500,000, Dividends ₦20,000, Retained Earnings ₦100,000. Prepare the company's balance sheet.

Correct A. Assets: ₦750,000, Liabilities: ₦150,000, Equity: ₦600,000

B. Assets: ₦650,000, Liabilities: ₦150,000, Equity: ₦500,000

C. Assets: ₦850,000, Liabilities: ₦150,000, Equity: ₦700,000

D. Assets: ₦950,000, Liabilities: ₦150,000, Equity: ₦800,000

Correct Answer: A

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Question 19

A company uses the perpetual inventory system. On January 1, the company had 100 units of inventory with a cost of ₦10 per unit. On January 15, the company purchased 50 units of inventory at ₦12 per unit. On February 1, the company sold 75 units of inventory. Calculate the cost of goods sold.

Correct A. ₦750

B. ₦800

C. ₦850

D. ₦900

Correct Answer: A

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Question 20

A company's income statement for the year ended December 31 shows the following: Sales ₦1,000,000, Cost of Goods Sold ₦600,000, Operating Expenses ₦200,000, Net Income ₦150,000. Prepare the company's statement of cash flows.

Correct A. Cash Flows from Operating Activities: ₦400,000, Cash Flows from Investing Activities: ₦0, Cash Flows from Financing Activities: ₦0

B. Cash Flows from Operating Activities: ₦500,000, Cash Flows from Investing Activities: ₦0, Cash Flows from Financing Activities: ₦0

C. Cash Flows from Operating Activities: ₦600,000, Cash Flows from Investing Activities: ₦0, Cash Flows from Financing Activities: ₦0

D. Cash Flows from Operating Activities: ₦700,000, Cash Flows from Investing Activities: ₦0, Cash Flows from Financing Activities: ₦0

Correct Answer: A

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Question 21

A company's trading account shows a profit of ₦1,500,000. The balance sheet shows a decrease in inventory of ₦250,000 and an increase in accounts payable of ₦300,000. What is the net effect on the company's cash position?

Correct A. ₦1,550,000

B. ₦1,250,000

C. ₦1,000,000

D. ₦750,000

Correct Answer: A

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Question 22

A partnership has two partners, A and B. Partner A has a 60% interest in the partnership and partner B has a 40% interest. If the partnership has a net income of ₦1,200,000, how much will partner A receive?

Correct A. ₦720,000

B. ₦600,000

C. ₦480,000

D. ₦360,000

Correct Answer: A

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Question 23

A company's balance sheet shows a current ratio of 2:1. If the company has ₦1,500,000 in current assets and ₦750,000 in current liabilities, what is the company's quick ratio?

Correct A. 1.5

B. 1.2

C. 1.0

D. 0.8

Correct Answer: A

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Question 24

A company's trial balance shows a debit balance of ₦1,200,000 in the accounts receivable account. If the company's balance sheet shows a credit balance of ₦900,000 in the accounts payable account, what is the company's net working capital?

Correct A. ₦300,000

B. ₦600,000

C. ₦900,000

D. ₦1,200,000

Correct Answer: A

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Question 25

A company's financial statements show a net income of ₦1,500,000 and a cash dividend of ₦750,000. If the company's retained earnings balance is ₦2,000,000, what is the company's new retained earnings balance?

Correct A. ₦2,250,000

B. ₦2,500,000

C. ₦2,750,000

D. ₦3,000,000

Correct Answer: A

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