Neco Model Questions Vol1 2024 Financial Accounting Question 20

Practice objective / multiple choice question 20 from the 2024 Neco Model Questions Vol1 Financial Accounting examination.

Neco Model Questions Vol1 2024 Financial Accounting Objective / Multiple Choice Hard Difficulty
Question 20 NECO_MODEL_QUESTIONS_VOL1 • 2024 • FINANCIAL_ACCOUNTING • objective

A company's opening balances are: share capital ₦500,000; retained earnings ₦200,000; goodwill ₦150,000 (to be amortised straight‑line over 5 years). During the year the company issued new shares for cash amounting to ₦120,000, incurred a loss of ₦30,000 and purchased equipment for ₦80,000 cash. Compute (a) the closing retained earnings, (b) the net book value of goodwill at year‑end, and (c) the total equity at year‑end.

Answer Options

Correct Answer A. Retained earnings = ₦170,000; goodwill = ₦120,000; total equity = ₦910,000
B. Retained earnings = ₦170,000; goodwill = ₦150,000; total equity = ₦940,000
C. Retained earnings = ₦170,000; goodwill = ₦120,000; total equity = ₦820,000
D. Retained earnings = ₦200,000; goodwill = ₦120,000; total equity = ₦940,000
Correct Answer
A
Correct Option:
Retained earnings = ₦170,000; goodwill = ₦120,000; total equity = ₦910,000

About This Question

This is Neco Model Questions Vol1 2024 Financial Accounting Question 20. It is one of the objective questions from the 2024 Neco Model Questions Vol1 Financial Accounting examination.

Difficulty level: Hard .

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