Neco Model Questions Vol1 2021 Financial Accounting Question 41

Practice objective / multiple choice question 41 from the 2021 Neco Model Questions Vol1 Financial Accounting examination.

Neco Model Questions Vol1 2021 Financial Accounting Objective / Multiple Choice Medium Difficulty
Question 41 NECO_MODEL_QUESTIONS_VOL1 • 2021 • FINANCIAL_ACCOUNTING • objective

The trial balance of ABC Ltd. as at 31 December 2021 shows the following balances (in naira): Cash Dr 45,000; Accounts Receivable Dr 30,000; Inventory Dr 25,000; Equipment Dr 50,000; Accumulated Depreciation - Equipment Cr 10,000; Accounts Payable Cr 20,000; Capital Cr 80,000; Sales Revenue Cr 70,000; Service Revenue Cr 15,000; Rent Expense Dr \(X\); Salaries Expense Dr 18,000; Utilities Expense Dr 7,000. The amount shown for Rent Expense is the result of a double‑posting error; the correct amount should be half of the amount shown. Determine the correct amount that should be recorded for Rent Expense and the balancing figure (the amount that must be added to the debit side) after correcting the error.

Answer Options

A. Rent Expense = ₦5,000; Balancing figure = ₦15,000
Correct Answer B. Rent Expense = ₦10,000; Balancing figure = ₦10,000
C. Rent Expense = ₦12,000; Balancing figure = ₦8,000
D. Rent Expense = ₦20,000; Balancing figure = ₦0
Correct Answer
B
Correct Option:
Rent Expense = ₦10,000; Balancing figure = ₦10,000

About This Question

This is Neco Model Questions Vol1 2021 Financial Accounting Question 41. It is one of the objective questions from the 2021 Neco Model Questions Vol1 Financial Accounting examination.

Difficulty level: Medium .

View More Neco Model Questions Vol1 2021 Financial Accounting Questions More Neco Model Questions Vol1 Practice Questions Back to Questions

Master the Exam!

You've seen a preview, but there are thousands more questions plus AI tutor to break down complex solutions.

Unlock Full Access Available for Android & Windows
Chat with Support