POST UTME LEAD CITY UNIVERSITY 2022 Accounting | Objective

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Question 1
A company issued 5,000, 10% debentures of ₦100 each at a discount of 5%. Calculate the amount received from debenture holders.
Correct A. ₦475,000
B. ₦475,000
C. ₦475,000
D. ₦475,000

Correct Answer: A

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Question 2
A company's trial balance showed an error of ₦5,000 in the debit side of the sales account. The correct balance of the sales account is ₦150,000. Prepare the necessary journal entry to correct the error.
Correct A. Debit Sales Account ₦5,000, Credit Profit and Loss Account ₦5,000
B. Debit Profit and Loss Account ₦5,000, Credit Sales Account ₦5,000
C. Debit Sales Account ₦5,000, Credit Sales Returns Account ₦5,000
D. Debit Sales Returns Account ₦5,000, Credit Sales Account ₦5,000

Correct Answer: A

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Question 3
A company's cash book showed a balance of ₦20,000 in the cash account. However, the bank statement showed a balance of ₦30,000. Prepare the necessary journal entry to reconcile the difference.
A. Debit Cash Account ₦10,000, Credit Bank Account ₦10,000
Correct B. Debit Bank Account ₦10,000, Credit Cash Account ₦10,000
C. Debit Cash Account ₦10,000, Credit Profit and Loss Account ₦10,000
D. Debit Profit and Loss Account ₦10,000, Credit Cash Account ₦10,000

Correct Answer: B

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Question 4
A company issued 10,000, 5% preference shares of ₦10 each at a premium of ₦2. The company also issued 5,000 ordinary shares of ₦5 each at a premium of ₦1. Calculate the total amount received from shareholders.
Correct A. ₦250,000
B. ₦250,000
C. ₦250,000
D. ₦250,000

Correct Answer: A

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Question 5
A company's trial balance showed an error of ₦10,000 in the debit side of the purchases account. The correct balance of the purchases account is ₦200,000. Prepare the necessary journal entry to correct the error.
Correct A. Debit Purchases Account ₦10,000, Credit Profit and Loss Account ₦10,000
B. Debit Profit and Loss Account ₦10,000, Credit Purchases Account ₦10,000
C. Debit Purchases Account ₦10,000, Credit Purchases Returns Account ₦10,000
D. Debit Purchases Returns Account ₦10,000, Credit Purchases Account ₦10,000

Correct Answer: A

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Question 6
A company's accounting policy requires that depreciation be calculated using the straight-line method. The company purchased a machine for ₦120,000 and it is expected to have a useful life of 5 years. Calculate the annual depreciation charge.
Correct A. ₦24,000
B. ₦20,000
C. ₦25,000
D. ₦22,000

Correct Answer: A

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Question 7
A partnership has two partners, A and B. The capital accounts of A and B are ₦50,000 and ₦30,000 respectively. The profit for the year is ₦20,000. Prepare the profit and loss account for the partnership.
Correct A. ₦80,000
B. ₦70,000
C. ₦60,000
D. ₦90,000

Correct Answer: A

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Question 8
A company's balance sheet as at 31st December 2022 is as follows: ₦150,000 in cash, ₦100,000 in accounts receivable, ₦50,000 in inventory, ₦20,000 in prepaid rent, ₦30,000 in accounts payable, and ₦40,000 in long-term debt. Calculate the company's working capital.
Correct A. ₦100,000
B. ₦120,000
C. ₦110,000
D. ₦130,000

Correct Answer: A

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Question 9
A company's financial statements for the year ended 31st December 2022 are as follows: ₦150,000 in revenue, ₦100,000 in cost of goods sold, ₦20,000 in operating expenses, ₦10,000 in depreciation, and ₦5,000 in interest expense. Calculate the company's net income.
Correct A. ₦30,000
B. ₦25,000
C. ₦35,000
D. ₦40,000

Correct Answer: A

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Question 10
A company's balance sheet as at 31st December 2022 is as follows: ₦150,000 in cash, ₦100,000 in accounts receivable, ₦50,000 in inventory, ₦20,000 in prepaid rent, ₦30,000 in accounts payable, and ₦40,000 in long-term debt. Calculate the company's current ratio.
Correct A. 2:1
B. 1:1
C. 3:1
D. 4:1

Correct Answer: A

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Question 11
A company uses the double-entry system of accounting. The following transactions occurred during the month of January: Purchased office supplies for ₦10,000, sold goods for ₦50,000, and paid salaries of ₦20,000. Prepare the journal entries for these transactions.
Correct A. Debit Office Supplies ₦10,000, Credit Cash ₦10,000
B. Debit Cash ₦50,000, Credit Sales ₦50,000
C. Debit Salaries ₦20,000, Credit Cash ₦20,000
D. Debit Office Supplies ₦10,000, Credit Sales ₦10,000

Correct Answer: A

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Question 12
A company's trial balance showed the following balances: Accounts Payable ₦50,000, Sales Revenue ₦100,000, Cost of Goods Sold ₦80,000, and Common Stock ₦200,000. Prepare the adjusted trial balance.
A. Accounts Payable ₦50,000, Sales Revenue ₦100,000, Cost of Goods Sold ₦80,000, Common Stock ₦200,000
B. Accounts Payable ₦50,000, Sales Revenue ₦100,000, Cost of Goods Sold ₦80,000, Common Stock ₦250,000
Correct C. Accounts Payable ₦50,000, Sales Revenue ₦100,000, Cost of Goods Sold ₦80,000, Common Stock ₦200,000
D. Accounts Payable ₦50,000, Sales Revenue ₦100,000, Cost of Goods Sold ₦80,000, Common Stock ₦150,000

Correct Answer: C

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Question 13
A company uses the single-entry system of accounting. The following transactions occurred during the month of January: Purchased office supplies for ₦10,000, sold goods for ₦50,000, and paid salaries of ₦20,000. Prepare the ledger accounts for these transactions.
Correct A. Office Supplies ₦10,000, Sales ₦50,000, Salaries ₦20,000
B. Office Supplies ₦10,000, Sales ₦50,000, Salaries ₦20,000
C. Office Supplies ₦10,000, Sales ₦50,000, Salaries ₦20,000
D. Office Supplies ₦10,000, Sales ₦50,000, Salaries ₦20,000

Correct Answer: A

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Question 14
A company's manufacturing account showed the following balances: Direct Materials ₦50,000, Direct Labor ₦30,000, and Manufacturing Overhead ₦20,000. Prepare the cost of goods sold.
Correct A. ₦100,000
B. ₦80,000
C. ₦60,000
D. ₦40,000

Correct Answer: A

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Question 15
A company uses the control account system. The following transactions occurred during the month of January: Purchased office supplies for ₦10,000, sold goods for ₦50,000, and paid salaries of ₦20,000. Prepare the control account for these transactions.
Correct A. Office Supplies ₦10,000, Sales ₦50,000, Salaries ₦20,000
B. Office Supplies ₦10,000, Sales ₦50,000, Salaries ₦20,000
C. Office Supplies ₦10,000, Sales ₦50,000, Salaries ₦20,000
D. Office Supplies ₦10,000, Sales ₦50,000, Salaries ₦20,000

Correct Answer: A

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Question 16
A company issues 10,000, 10% debentures of ₦100 each at a premium of 10%. Calculate the total amount received from debenture holders.
A. ₦1,000,000
Correct B. ₦1,050,000
C. ₦1,100,000
D. ₦1,150,000

Correct Answer: B

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Question 17
A manufacturing company uses a job costing system. The following data are given: Direct Materials: ₦30,000; Direct Labour: ₦20,000; Overheads: ₦15,000. Calculate the total cost of production.
Correct A. ₦65,000
B. ₦65,000
C. ₦65,000
D. ₦65,000

Correct Answer: A

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Question 18
A company's cash book shows the following transactions: Cash received from customers: ₦50,000; Cash paid to suppliers: ₦30,000; Cash paid to employees: ₦20,000. Calculate the net cash inflow.
Correct A. ₦0
B. ₦0
C. ₦0
D. ₦0

Correct Answer: A

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Question 19
A company issues 5,000, 12% preference shares of ₦10 each. Calculate the total amount received from preference shareholders.
Correct A. ₦50,000
B. ₦50,000
C. ₦50,000
D. ₦50,000

Correct Answer: A

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Question 20
A company's bank statement shows a balance of ₦20,000. The company's cash book shows a balance of ₦25,000. Calculate the difference between the two balances.
Correct A. ₦5,000
B. ₦5,000
C. ₦5,000
D. ₦5,000

Correct Answer: A

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Question 21
In a partnership with a capital of ₦1,500,000, where A and B share profits and losses in the ratio 3:2, and C joins the partnership with a capital of ₦750,000, what is the new ratio of their capitals?
Correct A. 2:1
B. 3:2
C. 4:3
D. 5:4

Correct Answer: A

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Question 22
A company's trial balance shows an error of ₦20,000 due to an incorrect posting of a transaction. The error is discovered during the preparation of the balance sheet. What is the correct journal entry to rectify the error?
A. Debit Cash ₦20,000, Credit Profit and Loss ₦20,000
Correct B. Debit Profit and Loss ₦20,000, Credit Cash ₦20,000
C. Debit Profit and Loss ₦20,000, Credit Capital ₦20,000
D. Debit Capital ₦20,000, Credit Profit and Loss ₦20,000

Correct Answer: B

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Question 23
A company's balance sheet shows a current ratio of 2:1. If the current assets increase by 20% and the current liabilities decrease by 15%, what is the new current ratio?
A. 1.8:1
Correct B. 2.2:1
C. 2.5:1
D. 3:1

Correct Answer: B

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Question 24
A company's profit and loss account shows a net profit of ₦500,000. If the company's capital is ₦1,000,000 and the drawings of the proprietor are ₦200,000, what is the proprietor's equity?
A. ₦1,300,000
B. ₦1,400,000
Correct C. ₦1,500,000
D. ₦1,600,000

Correct Answer: C

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Question 25
A company's balance sheet shows a total assets of ₦5,000,000 and a total liabilities of ₦3,000,000. What is the company's equity?
A. ₦1,000,000
Correct B. ₦2,000,000
C. ₦3,000,000
D. ₦4,000,000

Correct Answer: B

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