2015 - JAMB Accounting Past Questions & Answers - page 1

1
Use the following information to answer this question.

Club building 400,000

Subscription prepaid 3,000

Sport kits 150,000

Bar creditors 85,000

Subscription owing 32,000

What is the club’s total liabilities
A
N11, 700
B
N26, 700
C
N88, 000
D
N85, 000
CORRECT OPTION: c
i.e. creditors plus subscription in advance 85000 + 3000 = 88,000
2
If sales return is understated, it implies that ------------------------------ is overstated
A
return inward
B
sales figure
C
cost of sales
D
return outward
CORRECT OPTION: b
This is so because returns inwards are deducted from sales to ascertain the actual sales made after subtracting defected goods
3
Accounting information is used by investors and creditors of a company to predict
A
potential merger candidates for the company
B
appropriate remunerations for the company’s staff
C
future cash flows of the company
D
future tax payments of the company
CORRECT OPTION: c
4
Use the information below to answer this question.

\(\begin{array}{c|c}
\hline & \text{Dept A} & \text{Dept B} \\ \hline
\text{Sales} & 180,000 & 150,000 \\ \hline
\text{Cost of sales} & 79,000 & 85,000 \\ \hline
\text{Expense} & 28,000 & 40, 000 \\ \end{array}\)

How much is the gross profit for department A?
A
N101,000
B
N73,000
C
N79,000
D
N152,000
CORRECT OPTION: a
gross profit is sales less cost of sales i.e. N180,000 – N79,000 = N101,000
5
An advantage of using accounting ratios is that
A
can be easily calculated
B
show errors and frauds
C
facilitate decision making
D
are stipulated by law
CORRECT OPTION: c
Accounting ratios helps management in taking decision the totality of the activities in an organization
6
The document setting out the regulations regarding shares, meetings and internal organization of a company is known as
A
prospectus
B
memorandum of association
C
company law
D
articles of association
CORRECT OPTION: d
the article of association center on the rules and regulation governing the internal working of the company. It’s totally in line with the question.
7
The loss made by a non profit making organization is called
A
deficit
B
surplus
C
discount
D
shortage
CORRECT OPTION: a
deficit in a non for profit making organization stands for loss and it is the excess of expenses over bar profit and other income.
8
If rent account is debited instead of rate account, the error committed is that of;
A
omission
B
commission
C
principle
D
original entry
CORRECT OPTION: a
9
Use the following information to answer this question.

Provision for bad debt 1500

Additional information

1. Bad debt written off amount to 3000
2. Debtors balance as at the end of the year is 28,000
3. Provision for bad debts stand at 10%

How much is to be charged to profit and loss account as provision for bad debt?
A
N2, 800
B
N1, 000
C
N2, 500
D
N3, 000
CORRECT OPTION: b
Being that debtors balance minus bad debt written off multiplied by 10% and subtracted from the initial provision

28000 – 3000 = 25,000 X 10% = 2500

:. 2500 – 1500 = 1,000 (increase in provisions)
10
Use the information below to answer this question.

A limited liability company has an authorized shares capital of 50 million split into 100 millions shares. 80million shares are offered for subscriptions at 60k per share in full on application. These have been fully subscribed on issue

What is the nominal value of each share
A
N2
B
N0.80
C
N0.60
D
N0.50
CORRECT OPTION: d
Pages: