Post Utme Pan Atlantic University 2018 Accounting Question 4

Practice objective / multiple choice question 4 from the 2018 Post Utme Pan Atlantic University Accounting examination.

Post Utme Pan Atlantic University 2018 Accounting Objective / Multiple Choice
Question 4 POST_UTME_PAN-ATLANTIC_UNIVERSITY • 2018 • ACCOUNTING • objective

A company's financial statements are prepared in accordance with the cash basis of accounting. If the company pays ₦50,000 in cash for a new asset, but the asset is not yet used in the business, what is the correct treatment of the cash paid?

Answer Options

A. The cash paid is recorded as an asset.
Correct Answer B. The cash paid is recorded as an expense.
C. The cash paid is recorded as a liability.
D. The cash paid is recorded as revenue.
Correct Answer
B
Correct Option:
The cash paid is recorded as an expense.

About This Question

This is Post Utme Pan Atlantic University 2018 Accounting Question 4. It is one of the objective questions from the 2018 Post Utme Pan Atlantic University Accounting examination.

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