ACC204

Category: ACC204

ATTENTION:

Kindly note that you will be presented with 50 questions randomized from the NOUN question bank. Make sure to take the quiz multiple times so you can get familiar with the questions and answers, as new questions are randomized in each attempt.

Good luck!

ACC204

1 / 50

A. What is the gross profit on sales worth GHÂ¢240,000, if gross profit is 331/3% on cost of goods sold?

2 / 50

B. B operates the imprest system for petty cash. At 1 July there was a float of N150, but it was decided to increase this to N200 from 1 August onwards. During July, the petty cashier received N25 from staff for using the photocopier and a cheque for N90 was cashed for an employee. In July, cheques were drawn for N500 for petty cash.What was the total expense paid from petty cash in July?

1. 615

2. 435

3. 385

4. 515

3 / 50

C. The difference between an income statement and an income and expenditure account is that __________

1. An income statement is prepared for a business and an income and expenditure account is prepared for a not for profit making organisation.

2. An income statement is prepared for a manuf acturing business and an income and expenditure account is prepared for a non manufacturing business

3. An income statement is prepared on an accruals basis and an income and expenditure account is prepared on a cash flow basis.

4. An income and expenditure account is an international term for an Income statement

4 / 50

D. Electricity bill of N10,000 incurred during the year was not charged as an expense for that year. The error committed is ....................

5 / 50

E. What is an imprest system?

1. Records the use of a company's seal.

2. Is part of computerized accounting

3. Helps to control petty cash.

4. Helps to reconcile the cash book with the bank statement.

6 / 50

F. A Motor Van costs N100,000, Furniture N5,000, Creditors N25,000, what is the Loan amount. If Loan is 30% of the creditor's figure

7 / 50

G. SSG bought a machine for N40,000 in January year 1. The machine had an expected useful life of six years and an expected residual value of N10,000. The machine was depreciated on the straight-line basis where a full year�??s charge in made in the year of purchase and none in the year of sale. In December year 4, the machine was sold for N15,000. The company has a policy in its internal accounts of combining the depreciation charge with the profit or loss on disposal of assets. Its year end is 31 December.What is the total amount of profit/loss charged to the income statement over the life of the machine?

1. B. 20,000

2. C. 25,000

3. A. 15,000

4. D. 30,000

8 / 50

H. What is the depreciable amount of the machine?

1. 240000

2. 48000

3. 200000

4. 240000

9 / 50

I. Which of the following is NOT an accounting concept?

1. Consistency

2. Historical cost

3. Accrual

4. Information

10 / 50

J. The specific principles, bases, conventions, rules and practices applied by an entity in preparing and presenting financial statements are called ____________

11 / 50

K. Using straight line method, what would be the annual depreciation charge for the second year of usage?

1. 40250

2. 48250

3. 48000

4. 40000

12 / 50

L. Non-current assets can best be defined as Items of machinery which are not moveable and are purchase with an intention of resale

1. A AND B

2. VALID STATEMENT

3. NONE OF THE ABOVE

4. STATEMENT NOT VALID

13 / 50

M. A trader had trade receivables of 50,000 at the end of his accounting period. Trade receivables at the beginning of the period was 60,000. His policy is to make allowance for doubtful debts at the rate of 5%. State the change in value of the allowance for doubtful debts at the end of the current accounting period.

1. 500 increase in allowance

2. c. ¢2,500 decrease in allowance

3. 500 decrease in allowance

4. 2,500 increase in allowance

14 / 50

N. The data storage hierarchy is as follows:

1. Bits, Bytes, Field, Records, Files, Database

2. Database, Files, Records, Fields, Bytes, Bits

3. Bits, Field, Bytes, Files, Records, Database

4. Bytes, Records, Bits, Files, Bits, Database

15 / 50

O. Which of these books of account could be classified as a subsidiary book as well as a ledger

1. Cash book

2. General ledger

3. Nominal ledger

4. Sales day book

16 / 50

P. For every debit entry there is a corresponding credit entry. This principle represents _______

17 / 50

Q. The process of transferring the debit and credit items recorded in each journal to the relevant accounts in the ledger is called ________

18 / 50

R. A method of keeping accounts whereby revenue and expenses are recorded in the books of account when received and paid without regard to period to which they apply is called....................

19 / 50

S. Which ONE of the following attributes is the most important for any code to possess in order to be of use in an accounting system?

1. Linked to assets, liabilities, income, expenditure and capital.

2. Easy to change the code number.

3. A combination of letters and digits to ensure input accuracy.

4. Each code is a unique number.

20 / 50

T. An error of commission occurs where the entries required for a transaction are partially omitted.

1. a and b

2. Valid Statement

3. Statement not valid

4. all of the above

21 / 50

U. The VAT which is charged by suppliers on goods purchased is termed....................

22 / 50

V. The amount at which an asset is recognized after deducting any accumulated depreciation and accumulated impairment losses is called ________

23 / 50

W. A customer owing 200,000 was allowed to pay 180,000 in full settlement of his indebtedness. This results in a _____

1. Decrease in capital, decrease in asset and increase in liability

2. Receivables/Cash/Capital Decrease Receivables, increase cash and decrease capital

3. Decrease in asset, decrease in capital and decrease in liability

4. Decrease in liability, increase in asset and increase in capital

24 / 50

X. In what way should users be able to compare an entity's financial statement?

25 / 50

Y. A vehicle was purchased on 1 January 2011 at a cost of N2,000,000 and was depreciated at 25% on cost. It was sold on 31 December 2013 for N1,400,000. Full-year depreciation 25% on cost. It was sold on 31 December 2013 for N1,400,000. Full-year depreciation was charged in the years of purchase and disposal. Determine the profit or loss on the disposal

1. N900,000 loss

2. N500,000 profit

3. N900,000 profit

4. N500,000 loss

26 / 50

Z. Which of the following provides the origin of accounting information?

1. Ledger

2. Accounting books

3. Cash book

4. Source documents

27 / 50

AA. Which one of the following sentences does NOT explain the distinction between financial accounts and management accounts?

1. Financial accounts are normally produced annually and management accounts are normally produced monthly.

2. Financial accounts are more accurate than management accounts

3. Financial accounts are primarily for external users and management accounts are primarily for internal users.

4. Financial accounts are audited by management where as management accounts are audited by external auditors

28 / 50

AB. The opening inventory of a firm at the beginning of the financial year is N30,0000 and at the end of the financial year it isN20,000 while the sales and purchases are N350,000 and N250,000 respectively.What is the Gross Profit or Loss?

1. N10,000 Loss

2. N90,000 Profit

3. N50,000 Profit

4. N90,000 Loss

29 / 50

AC. The core objective of accounting is ________

1. Provide financial information to the users of such information

2. Maintain records of assets and liabilities

3. To fulfill statutory requirements

4. Keep record or transactions

30 / 50

AD. The adjusted cash book balance is _______

1. N109,500

2. N155,500

3. N100,000

4. N209,500

31 / 50

AE. Which of these statements CANNOT be defined as income?

1. Decrease in liabilities

2. Increase in economic benefits during the accounting period

3. Gains arising on the disposal of non-current asset

4. Decrease in economic benefits during the accounting period

32 / 50

AF. One of the following is a disadvantage of Application Packages.

1. They save programming efforts

2. They provide standard approach to common applications.

3. They make implementation of an application to be quicker and cheaper.

4. There may be inclusion of features that are not particularly relevant in the packages

33 / 50

AG. A company bought a machine on 1 October year 1 for N52,000. The machine had an expected life of eight years and an estimated residual value of N4,000. On 31 March year 6, the machine was sold for N35,000. The company's year end is 31 December. The company uses the straight-line method for depreciation and it charges a full year's depreciation in the year of purchase and none in the year of sale. What is the profit or loss on disposal of the machine?

1. D. Profit 13,000

2. A. Loss 13,000

3. C. Profit 10,000

4. B. Profit 7,000

34 / 50

AH. Which account is to be credited with the cash received in respect of trade receivables?

35 / 50

AI. Which of the following would result from an increase in the allowance for doubtful debts?

1. A decrease in net profit An increase in net profit .

2. An increase in gross profit

3. An increase in asset

4. decrease in gross profit

36 / 50

AJ. The costs incurred in the normal course of business to generate revenue is called........................

37 / 50

AK. On 1 January 2013 a motor vehicle, with the expected useful life span of 5 years and residual value of N100,000, was acquired for N1,600,000. Using sum-of-the-years digit method, what is the second year depreciation provision of the motor vehicle?

1. N400,000

2. N540,000

3. N426,000

4. N530,000

38 / 50

AL. The profit of a business may be calculated by using which one of the following formulae?

1. D. Closing capital - drawings + capital introduced - opening capital

2. B. Closing capital + drawings - capital introduced - opening capital

3. A. Opening capital - drawings + capital introduced - closing capital

4. C. Opening capital + drawings - capital introduced - closing capital

39 / 50

AM. H began trading on 1 July. The company is now preparing its accounts for the accounting year ended 30 June year 1. Rent is charged for the year from 1 April to 31 March, and was N1,800 for the year ended 31 March year 1 and N2,000 for the year ended 31 March year 2. Rent is payable quarterly in advance, plus any arrears, on 1 March, 1 June, 1 September and 1 December.The charge to H �??S income statement for rent for the year ended 30 June year 2 is _____

1. A. 1,650

2. C. 1,850

3. D. 1,900

4. B. 1,700

40 / 50

AN. P is a sole proprietor whose accounting records are incomplete. All the sales are cash sales and during the year N50,000 was banked, including N5,000 from the sale of a business car.He paid N12,000 wages in cash from the till and withdrew N2,000 per month as drawings.The cash in the till at the beginning and end of the year was N300 and N400 respectively.What were the sales for the year?

1. N81100

2. N86100

3. N80900

4. N81000

41 / 50

AO. When there is inflation, the historical cost convention has the effect of _________

1. Overstating cash flow and understating cash in the statement of financial position

2. Understating profits and overstating statement of financial position values.

3. Understating cash flow and overstating cash in the statement of financial position.

4. Overstating profits and understating statement of financial position values.

42 / 50

AP. Extended Trial Balance is an alternative way of arriving at the figures to be included in the __________

43 / 50

AQ. The difference between the monetary value of output and input of goods and services attributed to a business is called..........................

44 / 50

AR. The amount of wages paid to an employee after making appropriate deductions is referred to as ________

45 / 50

AS. The entries in a sales ledger control account are:Sales 250,000; Bank 225,000; Sales returns 2,500; Bad debts (irrecoverable debts?) 3,000; Bad debts (irrecoverable debts?) 3,000;Returned unpaid cheque 3,500; Contra with purchase ledger account 4,000;What is the balance on the sales ledger control account

1. N19000

2. N25000

3. N12000

4. N27000

46 / 50

AT. A Motor Van costs N100,000, Furniture N5,000, Creditors N25,000,. What is the capital account balance?

47 / 50

AU. Accrued Salaries of N18,000 due to employees for December 31 2015 was omitted and not included in the financial statements prepared for the year ended 31 December 2015 Which of the following will be correct?

1. Assets of the company would be over-stated by N18,000

2. Liabilities of the company would be under-stated by N18,000

3. Liabilities of the company would be over-stated by N18,000

4. Net profit of the company would be over-stated byN18,000

48 / 50

AV. At the end of the first year of trading, a trader's receivables amounted to 5,000. This excludes 180 debts found to be irrecoverable. At the same date, it was estimated that 70 of the 5,000 would still turn out to be irrecoverable debts. Determine the net realizable value of receivables at the end of the first year of trading.

1. 4750

2. 4930

3. 4820

4. 5000

49 / 50

AW. Which one of the following should be accounted for as capital expenditure?

1. The purchase of a car by a garage for re-sale

2. Cost of painting a building.

3. The replacement of windows in a building

4. Legal fees incurred on the purchase of a building.

50 / 50

AX. Salaries paid in the month was N26,152. Outstanding balance at the end of the month was N848. The salaries include an amount of N3,600 paid to the owner. What is the amount to be charged against the Profit and Loss Account for the month?

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