2019 - JAMB Accounting Past Questions and Answers - page 4
Use the question to answer this question:
| Opening stock | ₦ |
| Department A B |
100 800 |
| Purchases: A B Wages of workers Salaries |
1500 2000 50 100 |
| Sales A B |
3000 5000 |
Expenses are to be shared in the ratio of sales.
The net profit for departmental A is
1880
1600
880
425
Amount of goods sold for the departments = 1000 + 1500 = 2,500
Gross profit = Sales - Cost of goods sold
3000 - 2500 = ₦500
Hence,
Net profit = Gross profit - Expenses
500 - (50 ÷ 2 + 100 ÷ 2)
500 - (25 + 50)
500 - 75
Net profit = ₦425
Every economic unit, regardless of its legal form of existence, that is treated as a separate entity from parties having economic interest is
realisation concept
entity concept
going concern concept
matching concept
In accounting, a business or an organization and its owners are treated as two separately identifiable parties. This is called the entity concept. The business stands apart from other organizations as a separate economic unit. Wikipedia
The two recognised accounting bases are
cash and credit
personal and impersonal
Accrual and Cash
Drawings and Private
Accounting bases are the possible ways in which accounting concepts may be applied to financial transactions, e.g. the methods used to depreciate assets, how intangible assets or work in progress are dealt with.
Given:
Additional capital Capital Closing capital Net profit |
₦ 4000 8000 12000 1500 |
The drawings for the period stand at
1500
3000
12,000
10,500
Let:
OC = Opening Capital
AC = Additional Capital
NP = Net Profit
D = Drawings
CC = Closing Capital
Then;
OC + AC + NP - D = CC
8000 + 4000 + 1500 - D = 12,000
13,500 - D = 12,000
D = 13,500 - 12,000
D = ₦1500
Hence, Drawings = ₦1500
The importance of bank statement is all except
verifies the accuracy of balances of cash book and cheque book
helps to detect and rectify any error
helps to debit an account
helps to update the cash book
A bank statement is a list of all transactions for a bank account over a set period, usually monthly. The statement includes deposits, charges, withdrawals, as well as the beginning and ending balance for the period.
Accounting standards are issued at the International level by the
Standards Advisory Council
International Accounting Standards Board
Nigerian Accounting Standards Board
Standing Interpretations Committee
An accounting standard is a common set of principles, standards and procedures that define the basis of financial accounting policies and practices
Accounting standards are issued at the International level by the International Accounting Standards Board (IASB)
The method of stock valuation in which the issue price is obtained by dividing the value of stock in hand by unit of stock in hand is
FIFO
LIFO
SAP
WAP
Under Weighted Average Price (WAP) issues are priced at a weighted average price which is determined by dividing the value by the unit of stock in hand. Issues will continue to be priced at this price until a new batch is received when a new weighted average price is calculated.
One of these is not a similarity between Joint Venture and Partnership.
AIM is profit making
It is for a specific venture
Involves two people
have rights and duties
The main difference between a joint venture and a partnership is that the members of a joint venture have teamed together for a particular purpose or project, while the members of a partnership have joined together to run "a business in common". Each member of the joint venture retains ownership of his or her property.
via thebalancesmb
Majority of commercial transactions are termed credit transactions, which means
The buyers pay immediately for goods bought
Settlement is deferred to a future date
No account will be opened
Item of expenditure increases
In credit transactions, the settlement is at a future safe because the transfer of ownership takes place before payment to the supplier.
Bought motor vehicle ₦60 paying by cheque. The effect of the transaction will be
Increase in assets of motor vehicle account
Decrease in assets of motor vehicle account
Increase in assets of bank account
Increase in liabilities of bank account
There will be an increase in motor vehicle account and a decrease in the bank account because the vehicle account is the receiver while the bank account is giving out.