The term "accounting period" is used to refer to the
A
time span during which taxes are paid to the inland revenue board
B
budget period, usually one year, relied on by the accountant
C
time span, usually one year, covered by financial statement
D
period within which debtors are expected to settle accounts
Correct Option:
C
No further explanations yet...
2
Assigning revenues to the accounting period in which goods were sold or services rendered and expenses incurred is known as
A
passing of entries
B
consistency convention
C
matching concept
D
adjusting for revenue
Correct Option:
C
No further explanations yet...
3
The accounting convention which states that profit must not be recognized until realized while all losses should be adequately provided for it termed
A
materiality
B
objectivity
C
consistency
D
conservatism
Correct Option:
D
No further explanations yet...
4
Accounting information is used by investors and creditors of a company to predict
A
future cash flows of the company
B
future tax payments of the company
C
potential merger candidates for the company
D
appropriate remunerations for the company's staff
Correct Option:
A
No further explanations yet...
5
Antics Electronic Company recently bought six generators. Which of the following is the correct method of recording this transaction?
A
Debit generator account and credit cash account
B
Debit purchases account and credit cash account
C
Debit cash accounts and credit purchases account
D
Debit cash account and credit generator account
Correct Option:
A
No further explanations yet...
6
When a business incurs labour cost in installing a fixed asset, the cost is treated as
A
additional cost to the asset
B
business wages and salaries
C
installation cost of the asset
D
business cost of the asset
Correct Option:
A
No further explanations yet...
7
What is the cardinal rule of the double entry system?
A
Debit the increasing account and credit the decreasing account
B
Debit the receiving account and credit the giving account
C
Debit the asset account and credit the liability account
D
Debit the revenue account and credit the expenditure account
Correct Option:
B
No further explanations yet...
8
Mallam Gambo bought a freezer for his shop costing N10,500. In recording, he debited office expenses account and credited the bank account. What book-keeping error has he committed?
A
Error of commission
B
Error of reversal of entries
C
Error of principle
D
Compensating error
Correct Option:
C
No further explanations yet...
9
The use of the folio in the ledger is for
A
referencing purposes
B
particulars of the transaction
C
the account titles
D
only credit items
Correct Option:
A
No further explanations yet...
10
The suspense account is used to correct book-keeping error where the
A
amount involved is quite significant
B
item involved is not material
C
item involved is unknown
D
error does not affect the agreement of the trial balance
Correct Option:
D
No further explanations yet...
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