POST UTME BABCOCK UNIVERSITY 2022 Accounting | Objective

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Question 1
A partnership is formed between two individuals, A and B, with a capital of ₦500,000 each. The profit-sharing ratio is 3:2. If the profit for the year is ₦750,000, calculate the amount of profit that will be distributed to A.
A. ₦450,000
B. ₦525,000
C. ₦600,000
D. ₦675,000
Question 2
A company uses the single-entry system of accounting. The company has the following transactions: debit cash 10,000 and credit accounts payable 10,000. What is the effect of this transaction on the accounting equation?
A. Increases assets and decreases liabilities.
B. Decreases assets and increases liabilities.
C. Increases liabilities and decreases assets.
D. Has no effect on the accounting equation.
Question 3
A government agency uses the accrual basis of accounting. The agency's financial statements show the following balances: Accounts Payable ₦200,000, Salaries Expense ₦500,000, and Net Income ₦150,000. What is the correct journal entry to record the accrual of salaries?
A. ₦500,000 debit to Salaries Expense and ₦500,000 credit to Accounts Payable
B. ₦500,000 debit to Salaries Expense and ₦500,000 credit to Cash
C. ₦500,000 debit to Cash and ₦500,000 credit to Salaries Expense
D. ₦500,000 debit to Salaries Expense and ₦500,000 credit to Retained Earnings
Question 4
A company uses the self-balancing ledger system. Which of the following is a characteristic of this system?
A. It is used for trading and profit and loss accounts only
B. It is used for balance sheet accounts only
C. It is used for all types of accounts
D. It is used for manufacturing and departmental accounts only
Question 5
A government agency uses the accrual basis of accounting. The agency has the following transactions: revenue 100,000 and expenses 50,000. What is the net income of the agency?
A. 50,000
B. 100,000
C. 150,000
D. 200,000
Question 6
In a partnership account, the capital of a partner who withdraws cash from the business is reduced by the amount withdrawn. However, if the partner's capital is reduced below the minimum required by the partnership agreement, the deficit is treated as a loan from the partner to the business. What is the correct treatment of the deficit?
A. The deficit is treated as a loan from the partner to the business.
B. The deficit is treated as a loss of the business.
C. The deficit is treated as a reduction in the partner's capital.
D. The deficit is treated as a profit of the business.
Question 7
A manufacturing company uses a job costing system. The company has the following costs: direct materials 100,000, direct labor 150,000, and overhead 200,000. What is the total cost of production?
A. 550,000
B. 450,000
C. 650,000
D. 750,000
Question 8
A company has the following transactions: purchased goods for ₦500,000, sold goods for ₦700,000, and paid salaries of ₦150,000. What is the net effect on the company's cash balance?
A. ₦250,000 increase
B. ₦250,000 decrease
C. ₦500,000 increase
D. ₦500,000 decrease
Question 9
A company uses the straight-line method of depreciation. If the asset's useful life is 5 years and its residual value is ₦50,000, what is the annual depreciation charge if the asset's cost is ₦250,000?
A. ₦40,000
B. ₦45,000
C. ₦50,000
D. ₦55,000
Question 10
A government agency uses the accrual basis of accounting. The agency's financial statements show the following balances: Accounts Payable ₦250,000, Salaries Expense ₦700,000, and Net Income ₦250,000. What is the correct journal entry to record the accrual of salaries?
A. ₦700,000 debit to Salaries Expense and ₦700,000 credit to Accounts Payable
B. ₦700,000 debit to Salaries Expense and ₦700,000 credit to Cash
C. ₦700,000 debit to Cash and ₦700,000 credit to Salaries Expense
D. ₦700,000 debit to Salaries Expense and ₦700,000 credit to Retained Earnings
Question 11
A company has the following transactions related to its manufacturing department: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | 1st Jan | Raw Materials Purchased | ₦100,000 | | | 2nd Jan | Labour Cost | ₦50,000 | | | 3rd Jan | Work-in-Progress | | ₦150,000 | What is the total cost of goods manufactured?
A. ₦200,000
B. ₦250,000
C. ₦300,000
D. ₦350,000
Question 12
A company has the following transactions related to its manufacturing department: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | 1st Jan | Raw Materials Purchased | ₦100,000 | | | 2nd Jan | Labour Cost | ₦50,000 | | | 3rd Jan | Work-in-Progress | | ₦150,000 | What is the total cost of goods manufactured?
A. ₦200,000
B. ₦250,000
C. ₦300,000
D. ₦350,000
Question 13
A company uses the double-entry system of accounting. The company's ledger account for 'Raw Materials' has the following transactions: | Date | Debit | Credit | | --- | --- | --- | | 1st Jan | ₦100,000 | | | 2nd Jan | | ₦50,000 | What is the balance in the 'Raw Materials' account?
A. ₦50,000
B. ₦100,000
C. ₦150,000
D. ₦200,000
Question 14
A company's balance sheet shows the following balances: Cash ₦200,000, Accounts Payable ₦150,000, Common Stock ₦500,000, Retained Earnings ₦300,000. Prepare the company's statement of cash flows.
A. {\begin{tabular}{|l|l|} \hline \textbf{Cash Flows from Operating Activities} & \textbf{₦} \\ \hline \text{Net Income} & 300,000 \\ \text{Depreciation} & 100,000 \\ \text{Accounts Payable} & 150,000 \\ \hline \text{Total Cash Flows from Operating Activities} & 550,000 \\ \hline \end{tabular}}
B. {\begin{tabular}{|l|l|} \hline \textbf{Cash Flows from Investing Activities} & \textbf{₦} \\ \hline \text{Purchase of Assets} & 200,000 \\ \text{Sale of Assets} & 100,000 \\ \hline \text{Total Cash Flows from Investing Activities} & 100,000 \\ \hline \end{tabular}}
C. {\begin{tabular}{|l|l|} \hline \textbf{Cash Flows from Financing Activities} & \textbf{₦} \\ \hline \text{Issuance of Common Stock} & 500,000 \\ \text{Dividends Paid} & 100,000 \\ \hline \text{Total Cash Flows from Financing Activities} & 400,000 \\ \hline \end{tabular}}
D. {\begin{tabular}{|l|l|} \hline \textbf{Cash Flows from Operating Activities} & \textbf{₦} \\ \hline \text{Net Income} & 300,000 \\ \text{Depreciation} & 100,000 \\ \text{Accounts Payable} & 150,000 \\ \hline \text{Total Cash Flows from Operating Activities} & 550,000 \\ \hline \end{tabular}}
Question 15
A company issues 10,000, 9% debentures of ₦100 each at a discount of 5%. Calculate the amount of discount on the issue of debentures.
A. ₦50,000
B. ₦75,000
C. ₦90,000
D. ₦100,000

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