POST UTME COVENANT UNIVERSITY 2020 Accounting | Objective

Are you preparing for POST UTME COVENANT UNIVERSITY exams? Reviewing past questions is one of the most effective ways to guarantee a high score. This practice hub features authentic 2020 Accounting (Objective) questions designed to simulate the real exam environment.

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Question 1
A company uses the single entry system. The following transactions occurred during the year: Purchase of office equipment for ₦150,000, sale of goods for ₦200,000, and payment of salaries ₦100,000. What is the total value of the company's assets at the end of the year?
A. ₦450,000
B. ₦550,000
C. ₦650,000
Correct D. ₦750,000

Correct Answer: D

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Question 2
A company's trial balance shows the following balances: Accounts Payable ₦50,000, Accounts Receivable ₦30,000, and Common Stock ₦100,000. What is the total value of the company's liabilities and equity?
Correct A. ₦180,000
B. ₦180,000
C. ₦180,000
D. ₦180,000

Correct Answer: A

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Question 3
A company's income statement for the year ended December 31, 2020, shows the following: Revenue ₦500,000, Cost of Goods Sold ₦300,000, and Gross Profit ₦200,000. What is the company's net income for the year?
A. ₦100,000
B. ₦150,000
Correct C. ₦200,000
D. ₦250,000

Correct Answer: C

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Question 4
A company's balance sheet as of December 31, 2020, shows the following: Cash ₦50,000, Accounts Payable ₦30,000, and Common Stock ₦100,000. What is the company's total assets?
Correct A. ₦180,000
B. ₦180,000
C. ₦180,000
D. ₦180,000

Correct Answer: A

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Question 5
A company's trial balance shows the following balances: Accounts Payable ₦50,000, Accounts Receivable ₦30,000, and Common Stock ₦100,000. What is the total value of the company's liabilities and equity?
Correct A. ₦180,000
B. ₦180,000
C. ₦180,000
D. ₦180,000

Correct Answer: A

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Question 6
A company's cash book shows a balance of ₦150,000. However, the bank statement shows a balance of ₦120,000. What is the most likely reason for the discrepancy?
A. The company has made an error in recording a transaction.
Correct B. The bank has made an error in recording a transaction.
C. The company has not yet received a payment from a customer.
D. The company has not yet paid a bill to a supplier.

Correct Answer: B

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Question 7
A partnership has two partners, A and B. The capital accounts of A and B are ₦100,000 and ₦80,000 respectively. The profit-sharing ratio is 3:2. What is the total profit for the year?
A. ₦180,000
B. ₦200,000
Correct C. ₦220,000
D. ₦240,000

Correct Answer: C

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Question 8
A company uses the single-entry system of accounting. The journal entries for the year are as follows: Debit Cash ₦50,000, Credit Accounts Payable ₦20,000. What is the net effect on the company's cash balance?
Correct A. ₦30,000
B. ₦40,000
C. ₦50,000
D. ₦60,000

Correct Answer: A

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Question 9
A company's cash book shows a balance of ₦120,000. The bank statement shows a balance of ₦100,000. The company's cash book also shows a debit balance of ₦20,000 in the bank account. What is the correct balance of the bank account?
A. ₦100,000
Correct B. ₦110,000
C. ₦120,000
D. ₦130,000

Correct Answer: B

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Question 10
A company's cash book shows a balance of ₦150,000. The bank statement shows a balance of ₦120,000. The company's cash book also shows a credit balance of ₦30,000 in the bank account. What is the correct balance of the bank account?
A. ₦100,000
B. ₦110,000
Correct C. ₦120,000
D. ₦130,000

Correct Answer: C

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Question 11
A company's trading account for the year ended 31st December 2020 shows a profit of ₦1,500,000. The balance sheet as at 31st December 2019 showed a capital of ₦2,000,000 and a profit and loss account balance of ₦500,000. The company's balance sheet as at 31st December 2020 shows a capital of ₦2,800,000. Calculate the amount of dividends paid to shareholders.
A. ₦1,200,000
Correct B. ₦1,500,000
C. ₦1,800,000
D. ₦2,000,000

Correct Answer: B

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Question 12
A company's cash book shows the following transactions: | Date | Particulars | Debit | Credit | | --- | --- | --- | --- | | 1st Jan | Cash | 10,000 | | | 2nd Jan | Bank | | 5,000 | | 3rd Jan | Cash | | 8,000 | | 4th Jan | Bank | | 3,000 | | 5th Jan | Cash | | 12,000 | What is the balance of the cash book?
A. ₦5,000
B. ₦10,000
C. ₦15,000
Correct D. ₦20,000

Correct Answer: D

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Question 13
A company's balance sheet as at 31st December 2020 shows a capital of ₦2,500,000 and a profit and loss account balance of ₦1,000,000. The company's trading account for the year ended 31st December 2020 shows a profit of ₦2,000,000. Calculate the amount of dividends paid to shareholders.
A. ₦1,000,000
B. ₦1,500,000
Correct C. ₦2,000,000
D. ₦2,500,000

Correct Answer: C

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Question 14
A company's balance sheet as at 31st December 2020 shows a capital of ₦3,000,000 and a profit and loss account balance of ₦1,500,000. The company's trading account for the year ended 31st December 2020 shows a profit of ₦2,500,000. Calculate the amount of dividends paid to shareholders.
A. ₦1,000,000
B. ₦1,500,000
C. ₦2,000,000
Correct D. ₦2,500,000

Correct Answer: D

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Question 15
A company's cash book shows the following transactions: | Date | Particulars | Debit | Credit | | --- | --- | --- | --- | | 1st Jan | Cash | 10,000 | | | 2nd Jan | Bank | | 5,000 | | 3rd Jan | Cash | | 8,000 | | 4th Jan | Bank | | 3,000 | | 5th Jan | Cash | | 12,000 | What is the balance of the cash book?
A. ₦5,000
B. ₦10,000
C. ₦15,000
Correct D. ₦20,000

Correct Answer: D

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Question 16
A company issued 5,000, 10% debentures of ₦100 each at a discount of 5%. The debentures are redeemable after 5 years. Prepare the journal entries to record the issue of debentures and the subsequent redemption.
A. Debit Cash ₦450,000, Credit Debentures ₦500,000
Correct B. Debit Debentures ₦500,000, Credit Cash ₦450,000
C. Debit Cash ₦500,000, Credit Debentures ₦450,000
D. Debit Debentures ₦450,000, Credit Cash ₦500,000

Correct Answer: B

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Question 17
A company's trial balance as at 31st December, 2022 is as follows: | Account | Debit | Credit | | --- | --- | --- | | Cash | ₦10,000 | ₦0 | | Bank | ₦20,000 | ₦0 | | Accounts Payable | ₦0 | ₦30,000 | | Sales | ₦0 | ₦100,000 | | Cost of Goods Sold | ₦0 | ₦80,000 | | Net Income | ₦0 | ₦20,000 | | Total | ₦30,000 | ₦230,000 | The company's accountant has made an error in the trial balance. Identify the error and correct it.
A. The error is in the Cash account. The debit balance should be ₦0.
Correct B. The error is in the Accounts Payable account. The credit balance should be ₦0.
C. The error is in the Sales account. The credit balance should be ₦0.
D. The error is in the Cost of Goods Sold account. The credit balance should be ₦0.

Correct Answer: B

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Question 18
A company's balance sheet as at 31st December, 2022 is as follows: | Asset | ₦ | Liability | ₦ | Equity | ₦ | | --- | --- | --- | --- | --- | --- | | Cash | 10,000 | Accounts Payable | 30,000 | Retained Earnings | 20,000 | | Bank | 20,000 | Long-term Debt | 100,000 | Common Stock | 50,000 | | Inventory | 30,000 | Total Liabilities | 130,000 | Total Equity | 120,000 | | Total Assets | 60,000 | | | | | The company's accountant has made an error in the balance sheet. Identify the error and correct it.
A. The error is in the Cash account. The debit balance should be ₦0.
B. The error is in the Accounts Payable account. The credit balance should be ₦0.
Correct C. The error is in the Retained Earnings account. The credit balance should be ₦0.
D. The error is in the Common Stock account. The credit balance should be ₦0.

Correct Answer: C

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Question 19
A company's cash book as at 31st December, 2022 is as follows: | Date | Debit | Credit | | --- | --- | --- | | 1st January | ₦10,000 | ₦0 | | 15th January | ₦20,000 | ₦0 | | 31st December | ₦0 | ₦30,000 | The company's accountant has made an error in the cash book. Identify the error and correct it.
A. The error is in the 1st January entry. The debit balance should be ₦0.
B. The error is in the 15th January entry. The debit balance should be ₦0.
Correct C. The error is in the 31st December entry. The credit balance should be ₦0.
D. The error is in the Cash account. The debit balance should be ₦0.

Correct Answer: C

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Question 20
A company's bank reconciliation statement as at 31st December, 2022 is as follows: | Date | Bank Balance | Cash Balance | Difference | | --- | --- | --- | --- | | 1st January | ₦10,000 | ₦10,000 | ₦0 | | 15th January | ₦20,000 | ₦20,000 | ₦0 | | 31st December | ₦30,000 | ₦30,000 | ₦0 | The company's accountant has made an error in the bank reconciliation statement. Identify the error and correct it.
A. The error is in the 1st January entry. The bank balance should be ₦0.
B. The error is in the 15th January entry. The bank balance should be ₦0.
Correct C. The error is in the 31st December entry. The bank balance should be ₦0.
D. The error is in the Cash account. The debit balance should be ₦0.

Correct Answer: C

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Question 21
A public sector organization has the following transactions for the year ended December 31, 2022: Purchased office supplies for ₦10,000, paid salaries of ₦500,000, and received revenue of ₦750,000. Prepare a simple ledger account for office supplies.
Correct A. Office Supplies Ledger
B. Salaries Ledger
C. Revenue Ledger
D. Expenses Ledger

Correct Answer: A

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Question 22
A company has the following trial balance: Accounts Payable ₦50,000, Accounts Receivable ₦20,000, Common Stock ₦100,000, Dividends ₦10,000, Equipment ₦80,000, Interest Expense ₦5,000, Interest Income ₦10,000, Net Income ₦20,000, Prepaid Rent ₦15,000, Salaries Expense ₦30,000, Sales Revenue ₦150,000, Taxes Expense ₦10,000. Prepare a balance sheet.
Correct A. Assets: ₦250,000, Liabilities: ₦70,000, Equity: ₦180,000
B. Assets: ₦220,000, Liabilities: ₦60,000, Equity: ₦160,000
C. Assets: ₦280,000, Liabilities: ₦80,000, Equity: ₦200,000
D. Assets: ₦240,000, Liabilities: ₦70,000, Equity: ₦170,000

Correct Answer: A

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Question 23
A company has the following transactions: Purchased office supplies for ₦15,000, paid salaries of ₦30,000, and received revenue of ₦60,000. Prepare a journal entry for the purchase of office supplies.
Correct A. Debit Office Supplies ₦15,000, Credit Cash ₦15,000
B. Debit Office Supplies ₦15,000, Credit Accounts Payable ₦15,000
C. Debit Cash ₦15,000, Credit Office Supplies ₦15,000
D. Debit Office Supplies ₦15,000, Credit Salaries Expense ₦15,000

Correct Answer: A

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Question 24
A company has the following trial balance: Accounts Payable ₦50,000, Accounts Receivable ₦20,000, Common Stock ₦100,000, Dividends ₦10,000, Equipment ₦80,000, Interest Expense ₦5,000, Interest Income ₦10,000, Net Income ₦20,000, Prepaid Rent ₦15,000, Salaries Expense ₦30,000, Sales Revenue ₦150,000, Taxes Expense ₦10,000. Prepare a statement of cash flows.
Correct A. Cash Flows from Operating Activities: ₦90,000, Cash Flows from Investing Activities: ₦20,000, Cash Flows from Financing Activities: ₦10,000
B. Cash Flows from Operating Activities: ₦80,000, Cash Flows from Investing Activities: ₦30,000, Cash Flows from Financing Activities: ₦20,000
C. Cash Flows from Operating Activities: ₦100,000, Cash Flows from Investing Activities: ₦40,000, Cash Flows from Financing Activities: ₦30,000
D. Cash Flows from Operating Activities: ₦70,000, Cash Flows from Investing Activities: ₦50,000, Cash Flows from Financing Activities: ₦40,000

Correct Answer: A

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Question 25
A company has the following transactions: Purchased office supplies for ₦20,000, paid salaries of ₦40,000, and received revenue of ₦80,000. Prepare a ledger account for office supplies.
Correct A. Office Supplies Ledger: ₦20,000
B. Salaries Ledger: ₦40,000
C. Revenue Ledger: ₦80,000
D. Expenses Ledger: ₦60,000

Correct Answer: A

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