Gce Model Questions Vol1 2021 Financial Accounting Question 21

Practice objective / multiple choice question 21 from the 2021 Gce Model Questions Vol1 Financial Accounting examination.

Gce Model Questions Vol1 2021 Financial Accounting Objective / Multiple Choice Easy Difficulty
Question 21 GCE_MODEL_QUESTIONS_VOL1 • 2021 • FINANCIAL_ACCOUNTING • objective

On 15 March, XYZ Ltd purchased a computer for \(\text{₦}150,000\) cash. The price includes a recoverable VAT of 5 %. Record the appropriate journal entry, showing the amounts to be debited to the Computer Equipment account and the Input VAT account, and the amount credited to Cash.

Answer Options

Correct Answer A. Debit Computer Equipment \(\text{₦}142,857.14\)\nDebit Input VAT \(\text{₦}7,142.86\)\nCredit Cash \(\text{₦}150,000\)
B. Debit Computer Equipment (₦142,500.00) Debit Input VAT (₦7,500.00) Credit Cash (₦150,000)
C. Debit Computer Equipment (₦143,000.00) Debit Input VAT (₦7,000.00) Credit Cash (₦150,000)
D. Debit Computer Equipment (₦140,000.00) Debit Input VAT (₦10,000.00) Credit Cash (₦150,000)
Correct Answer
A
Correct Option:
Debit Computer Equipment \(\text{₦}142,857.14\)\nDebit Input VAT \(\text{₦}7,142.86\)\nCredit Cash \(\text{₦}150,000\)

About This Question

This is Gce Model Questions Vol1 2021 Financial Accounting Question 21. It is one of the objective questions from the 2021 Gce Model Questions Vol1 Financial Accounting examination.

Difficulty level: Easy .

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