POST UTME AL-HIKMAH UNIVERSITY 2025 Accounting | Objective

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Question 1
In a partnership account, what is the correct method of valuing a partner's loan to the firm?
A. At cost
Correct B. At cost plus interest
C. At cost minus interest
D. At market value

Correct Answer: B

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Question 2
What is the primary purpose of a trial balance in accounting?
Correct A. To detect errors in accounting records
B. To prepare financial statements
C. To determine the profitability of a business
D. To calculate depreciation

Correct Answer: A

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Question 3
A company uses a job costing system to account for its manufacturing activities. What is the correct procedure for assigning costs to a job?
A. Assign all costs to the job as soon as they are incurred
B. Assign costs to the job only when the job is completed
Correct C. Assign costs to the job as soon as the job is started
D. Assign costs to the job only when the job is sold

Correct Answer: C

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Question 4
A manufacturing company uses a process costing system to account for its production activities. What is the correct procedure for assigning costs to a process?
A. Assign all costs to the process as soon as they are incurred
B. Assign costs to the process only when the process is completed
Correct C. Assign costs to the process as soon as the process is started
D. Assign costs to the process only when the product is sold

Correct Answer: C

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Question 5
A company has the following transactions: Debit: Raw Materials 10,000, Work-in-Progress 20,000, Finished Goods 30,000 Credit: Purchases 40,000, Direct Labor 15,000, Overhead 25,000 What is the correct journal entry to record these transactions?
Correct A. Debit Raw Materials 10,000, Work-in-Progress 20,000, Finished Goods 30,000 Credit Purchases 40,000, Direct Labor 15,000, Overhead 25,000
B. Debit Purchases 40,000, Direct Labor 15,000, Overhead 25,000 Credit Raw Materials 10,000, Work-in-Progress 20,000, Finished Goods 30,000
C. Debit Raw Materials 10,000, Work-in-Progress 20,000, Finished Goods 30,000 Credit Purchases 40,000, Direct Labor 15,000
D. Debit Purchases 40,000, Direct Labor 15,000, Overhead 25,000 Credit Raw Materials 10,000, Work-in-Progress 20,000

Correct Answer: A

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Question 6
In a partnership account, what is the correct order of preparation of the following accounts?
Correct A. Trading and Profit and Loss Account, Balance Sheet, Partners' Capital Account
B. Balance Sheet, Trading and Profit and Loss Account, Partners' Capital Account
C. Partners' Capital Account, Balance Sheet, Trading and Profit and Loss Account
D. Trading and Profit and Loss Account, Partners' Capital Account, Balance Sheet

Correct Answer: A

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Question 7
A company is preparing its financial statements for the year ended 31st December 2024. The company's accounting year-end is 31st December, but the financial statements are to be prepared on a 30th June year-end. What is the accounting treatment for the following items?
A. Recognize the items in the financial statements as at 30th June 2024
Correct B. Recognize the items in the financial statements as at 31st December 2024
C. Recognize the items in the financial statements as at 30th June 2025
D. Recognize the items in the financial statements as at 31st December 2025

Correct Answer: B

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Question 8
A manufacturing company produces two products, X and Y. The company's production costs for the year ended 31st December 2024 are as follows: Direct Materials: ₦1,500,000; Direct Labour: ₦1,200,000; Variable Overheads: ₦900,000; Fixed Overheads: ₦600,000. What is the total production cost for the year?
A. ₦4,200,000
B. ₦4,500,000
C. ₦4,800,000
Correct D. ₦5,100,000

Correct Answer: D

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Question 9
A company has the following ledger balances as at 31st December 2024: Cash: ₦1,500,000; Bank: ₦2,000,000; Accounts Receivable: ₦1,800,000; Inventory: ₦2,500,000. What is the total value of the company's assets as at 31st December 2024?
A. ₦8,800,000
B. ₦9,300,000
C. ₦10,100,000
Correct D. ₦11,200,000

Correct Answer: D

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Question 10
A company has the following ledger balances as at 31st December 2024: Cash: ₦1,500,000; Bank: ₦2,000,000; Accounts Payable: ₦1,800,000; Accrued Expenses: ₦2,500,000. What is the total value of the company's liabilities as at 31st December 2024?
A. ₦6,800,000
B. ₦7,300,000
C. ₦8,100,000
Correct D. ₦9,200,000

Correct Answer: D

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Question 11
A company uses the double-entry system to record a transaction. The transaction involves the purchase of equipment for ₦150,000. The equipment is expected to have a useful life of 5 years and a residual value of ₦20,000. Calculate the annual depreciation using the straight-line method.
A. ₦25,000
B. ₦30,000
Correct C. ₦28,000
D. ₦32,000

Correct Answer: C

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Question 12
A company's cash book shows the following transactions: | Date | Particulars | Debit | Credit | | --- | --- | --- | --- | | 1 Jan | Cash | ₦1,000 | | | 2 Jan | Bank | | ₦500 | | 3 Jan | Cash | | ₦200 | | 4 Jan | Bank | ₦300 | | | 5 Jan | Cash | | ₦150 | What is the balance in the cash book on 5 January?
Correct A. ₦1,250
B. ₦1,350
C. ₦1,450
D. ₦1,550

Correct Answer: A

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Question 13
A company issues 10,000 shares of ₦1 each at a premium of ₦0.50 per share. Calculate the total amount received from the issue of shares.
Correct A. ₦5,500
B. ₦5,500.00
C. ₦5,500.00
D. ₦5,500.00

Correct Answer: A

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Question 14
A company's balance sheet shows the following: | Assets | ₦1,500,000 | | Liabilities | ₦800,000 | | Share Capital | ₦300,000 | | Retained Earnings | ₦200,000 | What is the company's net worth?
Correct A. ₦500,000
B. ₦600,000
C. ₦700,000
D. ₦800,000

Correct Answer: A

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Question 15
A company's cash book shows the following transactions: | Date | Particulars | Debit | Credit | | --- | --- | --- | --- | | 1 Jan | Cash | ₦1,000 | | | 2 Jan | Bank | | ₦500 | | 3 Jan | Cash | | ₦200 | | 4 Jan | Bank | ₦300 | | | 5 Jan | Cash | | ₦150 | What is the balance in the bank on 5 January?
A. ₦1,250
Correct B. ₦1,350
C. ₦1,450
D. ₦1,550

Correct Answer: B

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Question 16
A company manufactures two products, X and Y, using a common machine. The production process for each product involves two stages: cutting and assembly. The cutting stage requires 2 hours for product X and 3 hours for product Y. The assembly stage requires 1 hour for product X and 2 hours for product Y. The machine can operate for a maximum of 8 hours per day. If the company operates for 5 days a week, what is the maximum number of units of product X that can be produced in a week?
A. 120
B. 150
Correct C. 180
D. 200

Correct Answer: C

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Question 17
A partnership is formed between two individuals, A and B, with initial capital contributions of ₦100,000 and ₦200,000, respectively. After one year, the partnership earns a profit of ₦150,000. The profit is divided in the ratio 2:3. What is the amount of profit shared by partner A?
A. ₦50,000
Correct B. ₦75,000
C. ₦100,000
D. ₦125,000

Correct Answer: B

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Question 18
A company uses the perpetual inventory system. On January 1, the inventory balance is ₦50,000. During the month, the company purchases goods worth ₦30,000 and sells goods worth ₦20,000. What is the inventory balance on January 31?
A. ₦40,000
B. ₦50,000
Correct C. ₦60,000
D. ₦70,000

Correct Answer: C

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Question 19
A company has the following transactions: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | Jan 1 | Cash | ₦10,000 | | | Jan 10 | Sales | | ₦15,000 | | Jan 15 | Purchases | ₦5,000 | | | Jan 20 | Cash | | ₦20,000 | What is the net cash flow for the month of January?
A. ₦5,000
B. ₦10,000
Correct C. ₦15,000
D. ₦20,000

Correct Answer: C

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Question 20
A company uses the self-balancing ledger system. The following transactions are recorded: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | Jan 1 | Cash | ₦10,000 | | | Jan 10 | Sales | | ₦15,000 | | Jan 15 | Purchases | ₦5,000 | | | Jan 20 | Cash | | ₦20,000 | What is the total amount of cash recorded in the ledger?
A. ₦25,000
B. ₦30,000
C. ₦35,000
Correct D. ₦40,000

Correct Answer: D

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Question 21
A company issues 10,000 shares of ₦1 each at a premium of ₦0.50 per share. Calculate the total amount received from the issue of shares.
A. ₦0,500
B. ₦1,000
Correct C. ₦1,050
D. ₦1,500

Correct Answer: C

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Question 22
A company has a capital of ₦0,000 divided into 5,000 shares of ₡0 each. If the company issues 2,000 shares at a premium of ₥0 per share, calculate the amount received from the issue of shares.
A. ₡0,000
Correct B. ₢0,000
C. ₣0,000
D. ₤0,000

Correct Answer: B

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Question 23
A company has a capital of ₦0,000 divided into 5,000 shares of ₡0 each. If the company issues 2,000 shares at a premium of ₥0 per share, calculate the amount received from the issue of shares.
A. ₡0,000
Correct B. ₢0,000
C. ₣0,000
D. ₤0,000

Correct Answer: B

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Question 24
A company has a capital of ₦0,000 divided into 5,000 shares of ₡0 each. If the company issues 2,000 shares at a premium of ₥0 per share, calculate the amount received from the issue of shares.
A. ₡0,000
Correct B. ₢0,000
C. ₣0,000
D. ₤0,000

Correct Answer: B

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Question 25
A company has a capital of ₦0,000 divided into 5,000 shares of ₡0 each. If the company issues 2,000 shares at a premium of ₥0 per share, calculate the amount received from the issue of shares.
A. ₡0,000
Correct B. ₢0,000
C. ₣0,000
D. ₤0,000

Correct Answer: B

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