POST UTME MOUNTAIN TOP UNIVERSITY 2019 Accounting | Objective

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Question 1
The trial balance of XYZ Ltd. shows the following balances: Accounts Payable: ₦150,000, Sales Revenue: ₦500,000, Cost of Goods Sold: ₦300,000, and Common Stock: ₦200,000. What is the total amount of assets on the balance sheet?
A. ₦850,000
B. ₦950,000
Correct C. ₦1,050,000
D. ₦1,200,000

Correct Answer: C

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Question 2
A company uses the weighted average method to assign overhead costs to jobs. The following data are available: Job 1: 10 units, Job 2: 20 units, Overhead Costs: ₦15,000, and Total Units: 30. What is the overhead cost per unit?
A. ₦500
Correct B. ₦1,000
C. ₦1,500
D. ₦2,000

Correct Answer: B

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Question 3
A company's trial balance shows the following balances: Accounts Payable: ₦150,000, Sales Revenue: ₦500,000, Cost of Goods Sold: ₦300,000, and Common Stock: ₦200,000. What is the total amount of liabilities on the balance sheet?
Correct A. ₦350,000
B. ₦450,000
C. ₦550,000
D. ₦650,000

Correct Answer: A

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Question 4
A company uses the FIFO method to assign overhead costs to jobs. The following data are available: Job 1: 10 units, Job 2: 20 units, Overhead Costs: ₦15,000, and Total Units: 30. What is the overhead cost per unit?
A. ₦500
B. ₦1,000
Correct C. ₦1,500
D. ₦2,000

Correct Answer: C

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Question 5
A company's balance sheet shows the following balances: Assets: ₦1,000,000, Liabilities: ₦500,000, and Equity: ₦500,000. What is the total amount of assets on the balance sheet?
Correct A. ₦1,500,000
B. ₦1,600,000
C. ₦1,700,000
D. ₦1,800,000

Correct Answer: A

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Question 6
Determine the amount of depreciation for a machine that cost ₦250,000 and has a useful life of 5 years, using the straight-line method. The machine is currently in its third year of operation.
A. ₦50,000
Correct B. ₦62,500
C. ₦75,000
D. ₦87,500

Correct Answer: B

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Question 7
A company has a control account for its cash transactions. The following transactions occurred during the month of January: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | 1-Jan | Cash | 10,000 | | | 5-Jan | Bank | | 12,000 | | 10-Jan | Cash | 8,000 | | | 15-Jan | Bank | | 9,000 | | 20-Jan | Cash | 12,000 | | | 25-Jan | Bank | | 15,000 | What is the balance in the cash control account at the end of January?
A. ₦20,000
B. ₦30,000
Correct C. ₦40,000
D. ₦50,000

Correct Answer: C

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Question 8
A company issued 10,000 shares of ₦1 each at a premium of ₦0.50 per share. The company also issued 5,000 10% debentures of ₦100 each. Calculate the total amount received from the issue of shares and debentures.
A. ₦105,000
B. ₦110,000
C. ₦115,000
Correct D. ₦120,000

Correct Answer: D

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Question 9
A partnership has two partners, A and B. The capital accounts of A and B are ₦50,000 and ₦30,000 respectively. The profit-sharing ratio is 3:2. Calculate the profit to be distributed to each partner.
A. ₦20,000
B. ₦30,000
Correct C. ₦40,000
D. ₦50,000

Correct Answer: C

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Question 10
A company has the following incomplete records: | Date | Description | Debit | Credit | | --- | --- | --- | --- | | 1-Jan | Sales | 10,000 | | | 5-Jan | Purchases | | 8,000 | | 10-Jan | Sales | 12,000 | | | 15-Jan | Purchases | | 9,000 | | 20-Jan | Sales | 15,000 | | | 25-Jan | Purchases | | 12,000 | Determine the net profit for the month of January.
A. ₦20,000
B. ₦30,000
C. ₦40,000
Correct D. ₦50,000

Correct Answer: D

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Question 11
In a partnership account, the capital of a partner is increased by the amount of profit earned by the firm. If the initial capital of the partners is ₦100,000 and the profit earned is ₦20,000, what is the new capital of the partners?
Correct A. ₦120,000
B. ₦110,000
C. ₦130,000
D. ₦140,000

Correct Answer: A

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Question 12
A company uses the double-entry system of accounting. The following transactions were recorded in the journal: Debit Cash ₦10,000, Credit Accounts Payable ₦5,000, Debit Accounts Receivable ₦8,000, Credit Sales ₦12,000. What is the net effect on the company's cash position?
Correct A. ₦5,000 increase
B. ₦5,000 decrease
C. ₦10,000 increase
D. ₦10,000 decrease

Correct Answer: A

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Question 13
A company has a control account for its accounts payable. The following transactions were recorded in the ledger: Debit Accounts Payable ₦10,000, Credit Purchases ₦15,000, Debit Cash ₦8,000, Credit Accounts Payable ₦5,000. What is the net effect on the company's accounts payable?
Correct A. ₦5,000 increase
B. ₦5,000 decrease
C. ₦10,000 increase
D. ₦10,000 decrease

Correct Answer: A

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Question 14
A company prepares a trial balance at the end of the year. The following accounts are listed: Cash ₦50,000, Accounts Payable ₦20,000, Sales ₦80,000, Purchases ₦60,000. What is the total amount of the company's assets?
Correct A. ₦110,000
B. ₦120,000
C. ₦130,000
D. ₦140,000

Correct Answer: A

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Question 15
A company uses a cash book to record its transactions. The following entries were recorded: Debit Cash ₦10,000, Credit Sales ₦12,000, Debit Accounts Payable ₦5,000, Credit Purchases ₦8,000. What is the net effect on the company's cash position?
Correct A. ₦5,000 increase
B. ₦5,000 decrease
C. ₦10,000 increase
D. ₦10,000 decrease

Correct Answer: A

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Question 16
A company's trial balance shows a debit balance of ₦50,000 in the 'Accrued Expenses' account. However, the company's accounting records show that the actual amount of accrued expenses is ₦75,000. What is the correct journal entry to record the adjustment?
Correct A. Debit Accrued Expenses ₦25,000, Credit Accrued Expenses ₦25,000
B. Debit Accrued Expenses ₦25,000, Credit Profit and Loss ₦25,000
C. Debit Profit and Loss ₦25,000, Credit Accrued Expenses ₦25,000
D. Debit Accrued Expenses ₦50,000, Credit Accrued Expenses ₦50,000

Correct Answer: A

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Question 17
A partnership has two partners, A and B, who share profits and losses in the ratio 3:2. The partnership's trial balance shows a debit balance of ₦20,000 in the 'Drawings' account. What is the correct allocation of the drawings to the partners?
Correct A. Partner A ₦12,000, Partner B ₦8,000
B. Partner A ₦15,000, Partner B ₦5,000
C. Partner A ₦18,000, Partner B ₦2,000
D. Partner A ₦10,000, Partner B ₦10,000

Correct Answer: A

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Question 18
A company's balance sheet shows a current asset of ₦150,000 in the 'Accounts Receivable' account. However, the company's accounting records show that the actual amount of accounts receivable is ₦200,000. What is the correct journal entry to record the adjustment?
A. Debit Accounts Receivable ₦50,000, Credit Profit and Loss ₦50,000
Correct B. Debit Accounts Receivable ₦50,000, Credit Cash ₦50,000
C. Debit Cash ₦50,000, Credit Accounts Receivable ₦50,000
D. Debit Accounts Receivable ₦100,000, Credit Profit and Loss ₦100,000

Correct Answer: B

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Question 19
A company's trial balance shows a credit balance of ₦30,000 in the 'Accrued Income' account. However, the company's accounting records show that the actual amount of accrued income is ₦20,000. What is the correct journal entry to record the adjustment?
Correct A. Debit Accrued Income ₦10,000, Credit Profit and Loss ₦10,000
B. Debit Accrued Income ₦10,000, Credit Cash ₦10,000
C. Debit Cash ₦10,000, Credit Accrued Income ₦10,000
D. Debit Accrued Income ₦10,000, Credit Profit and Loss ₦20,000

Correct Answer: A

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Question 20
A partnership has two partners, A and B, who share profits and losses in the ratio 3:2. The partnership's trial balance shows a debit balance of ₦25,000 in the 'Drawings' account. What is the correct allocation of the drawings to the partners?
Correct A. Partner A ₦15,000, Partner B ₦10,000
B. Partner A ₦18,000, Partner B ₦7,000
C. Partner A ₦20,000, Partner B ₦5,000
D. Partner A ₦12,000, Partner B ₦13,000

Correct Answer: A

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Question 21
Determine the amount of depreciation for a machine that cost ₦150,000 and has a useful life of 5 years, with a residual value of ₦30,000. The machine is depreciated using the straight-line method.
A. ₦20,000
Correct B. ₦25,000
C. ₦30,000
D. ₦35,000

Correct Answer: B

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Question 22
A partnership has 3 partners, A, B, and C, with capital contributions of ₦100,000, ₦80,000, and ₦60,000 respectively. The profit-sharing ratio is 3:2:1. Calculate the total profit and the share of each partner.
A. ₦180,000
Correct B. ₦200,000
C. ₦220,000
D. ₦240,000

Correct Answer: B

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Question 23
A company prepares its financial statements in accordance with the accrual accounting method. The company has the following transactions: Sale of goods for ₦50,000, Purchase of goods for ₦30,000, Rent received from tenants for ₦20,000, Salaries paid to employees for ₦15,000. Prepare the trading account and profit and loss account.
Correct A. Trading Account: ₦50,000; Profit and Loss Account: ₦25,000
B. Trading Account: ₦50,000; Profit and Loss Account: ₦30,000
C. Trading Account: ₦50,000; Profit and Loss Account: ₦35,000
D. Trading Account: ₦50,000; Profit and Loss Account: ₦40,000

Correct Answer: A

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Question 24
A company has the following balance sheet: Assets: ₦100,000; Liabilities: ₦80,000; Capital: ₦20,000. Prepare the trading account and profit and loss account.
A. Trading Account: ₦20,000; Profit and Loss Account: ₦10,000
Correct B. Trading Account: ₦20,000; Profit and Loss Account: ₦15,000
C. Trading Account: ₦20,000; Profit and Loss Account: ₦20,000
D. Trading Account: ₦20,000; Profit and Loss Account: ₦25,000

Correct Answer: B

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Question 25
A company has the following trial balance: Debit: ₦100,000; Credit: ₦80,000. Prepare the balance sheet.
A. Assets: ₦100,000; Liabilities: ₦80,000; Capital: ₦20,000
B. Assets: ₦80,000; Liabilities: ₦100,000; Capital: ₦20,000
Correct C. Assets: ₦100,000; Liabilities: ₦80,000; Capital: ₦20,000
D. Assets: ₦80,000; Liabilities: ₦100,000; Capital: ₦20,000

Correct Answer: C

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