POST UTME JOSEPH AYO BABALOLA UNIVERSITY 2024 Accounting | Objective

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Question 1
A company uses the accrual basis of accounting. If the company has accounts payable of ₦100,000 and accounts receivable of ₦80,000, what is the net amount of current liabilities?
A. ₦20,000
B. ₦30,000
C. ₦40,000
D. ₦50,000
Question 2
A company issued 10,000 shares of 1 par value at a premium of 3 per share. The shares were sold for 4 each. Prepare the journal entry to record the issue of these shares.
A. Debit Cash 40,000, Credit Common Stock 10,000, Credit Paid-in Capital in Excess of Par Value 30,000
B. Debit Common Stock 10,000, Credit Paid-in Capital in Excess of Par Value 30,000, Credit Cash 40,000
C. Debit Common Stock 10,000, Credit Paid-in Capital in Excess of Par Value 30,000, Credit Cash 40,000
D. Debit Paid-in Capital in Excess of Par Value 30,000, Credit Common Stock 10,000, Credit Cash 40,000
Question 3
A company purchases a machine for ₦500,000 and sells it after one year for ₦600,000. Calculate the profit made from the sale of the machine.
A. ₦50,000
B. ₦75,000
C. ₦100,000
D. ₦125,000
Question 4
A trader bought 200 units of a product at £ 20 each. He then sold 150 units at £ 30 each and the remaining units at £ 25 each. Calculate the profit made by the trader.
A. £ 1,500
B. £ 2,000
C. £ 2,500
D. £ 3,000
Question 5
A company uses the double-declining balance method to depreciate its assets. If the asset's cost is ₦120,000, its residual value is ₦20,000, and it is used for 5 years, what is the annual depreciation charge?
A. ₦24,000
B. ₦26,000
C. ₦28,000
D. ₦30,000
Question 6
A company issues 5,000 8% shares of ₦20 each at a premium of ₦5. Calculate the total amount received from shareholders.
A. ₦125,000
B. ₦150,000
C. ₦175,000
D. ₦200,000
Question 7
A government agency is considering the adoption of a new accounting system. The current system uses a cash basis of accounting, while the proposed system uses an accrual basis of accounting. Which of the following is a key advantage of the accrual basis of accounting?
A. Improved matching of revenues and expenses
B. Simplified financial reporting
C. Reduced accounting costs
D. Increased financial leverage
Question 8
A company uses the double-entry system of accounting. The company's accountant has recorded the following transactions: Debit: Accounts Payable 2,000, Equipment 3,000 Credit: Cash 1,000, Sales Revenue 4,000 What is the net effect on the company's cash balance?
A. 1,500 increase
B. 2,500 increase
C. 3,500 increase
D. 4,500 increase
Question 9
A company uses the straight-line method of depreciation. If the cost of an asset is ₦120,000 and its useful life is 5 years, what is the annual depreciation charge?
A. ₦24,000
B. ₦20,000
C. ₦18,000
D. ₦22,000
Question 10
A company's cash book showed a debit balance of £ 10,000. The bank statement showed a credit balance of £ 12,000. The difference between the two balances is £ 2,000. Calculate the bank's reconciliation statement.
A. £ 10,000
B. £ 12,000
C. £ 14,000
D. £ 16,000
Question 11
A company uses the double-entry system of accounting. The company's accountant has recorded the following transactions: Debit: Accounts Payable 2,000, Equipment 3,000 Credit: Cash 1,000, Sales Revenue 4,000 What is the net effect on the company's cash balance?
A. 1,500 increase
B. 2,500 increase
C. 3,500 increase
D. 4,500 increase
Question 12
A company purchases a machine for ₦300,000 and sells it after two years for ₦450,000. Calculate the profit made from the sale of the machine.
A. ₦75,000
B. ₦100,000
C. ₦125,000
D. ₦150,000
Question 13
A company issued 5,000 shares of £ 10 each at a premium of £ 2 per share. Calculate the total amount received from the issue of shares.
A. £ 50,000
B. £ 60,000
C. £ 70,000
D. £ 80,000
Question 14
A company's balance sheet shows the following balances: Cash ₦50,000, Accounts Payable ₦20,000, Common Stock ₦100,000, and Retained Earnings ₦30,000. What is the company's total liabilities?
A. ₦40,000
B. ₦50,000
C. ₦60,000
D. ₦70,000
Question 15
A company has the following balance sheet: Assets 100,000, Liabilities 80,000, Equity 20,000. What is the correct journal entry to correct the error?
A. Debit 20,000, Credit 20,000
B. Debit 20,000, Credit 20,000
C. Debit 20,000, Credit 20,000
D. Debit 20,000, Credit 20,000

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