2017 - JAMB Accounting Past Questions & Answers - page 3

21
Given:
I. It records subscription in arrears
II. Payments of liabilities is effected
III. The account does not show if cash payment is revenue or capital expenditure
IV. It performs the same function as cashbook
The features of receipts and payment account includes
A
I,II and IV
B
II,III and IV
C
III and IV
D
I,II and III
CORRECT OPTION: b
The receipts and payment account is one of the account of a non-profit oriented organization that performs the same functions as cash account in a profit oriented organization
all forms of payment since cash is involved will be recorded and also performs the same functions as the cashbook does for profit oriented organization
22
The movement of goods from head office to a branch is treated in the head office as
A
Sales
B
issue
C
purchases
D
requisition
CORRECT OPTION: b
23
The following are the importance of branch account except
A
it enable the organization to determine the branch that is making either profit or loss
B
it allows proper control over the branch by the head office
C
it assist the organization to determine the performance of a branch manager
D
it allows fraud and wastage of resources
CORRECT OPTION: d
The activities and resources of branches is strictly monitored by the head office and each branch is supplied according to its need so it will be difficult to commit fraud or waste any resources
24
The current growth in the volume of trading and financial dealing in Nigeria is helped by
A
increased financial activities
B
government intervention
C
credit as a factor in business
D
Payment for goods in cash
CORRECT OPTION: a
25
One of the options below have the same features as the profit and loss account in non-profit organization
A
Income and expenditure account
B
profit and loss account
C
receipts and payment account
D
Non profit account
CORRECT OPTION: a
Income and expenditure : This is the type of account that operate same features as the profit and loss account it takes in consideration all arrears and prepayments
26
Calculate the discount received in Department B
\(\begin{array}{c|c} & \text{Dept A} & \text{Dept B} \ \hline & N & \ \hline \text{Sales} & 250 000 & 500 000 \ \hline \text{Purchases} & 150 000 & 250 000 \ \hline \text{Discount received} & 24 000 & \ \hline \text{Discount allowed} & 15 000 & &
\end{array}\)
A
₦12,000
B
₦15,000
C
₦16,000
D
₦9,000
CORRECT OPTION: b
Before calculating the discount received in Dep. B

We need to calculate the percentage of purchases for Dep B

Out of the total purchases

Dep. A purchases 150,000

Dep. B purchases 250,000

400,000 - Total purchases

there4; \(\frac{250,000 \times 24,000}{\text{(Total discount received)}}\) x 400,000

= 15,000
27
An advantage of FIFO method of stock valuation is that
A
it serves-as a control during inflation
B
it is calculated at the end of the year
C
it is progressive in nature
D
its flow of cost is in sequence with the flow of stock.
CORRECT OPTION: d
The first in first out(FIFO) method of stock valuation, major advantage 1 it is very easy to apply 2 no manipulation of income is possible 3 the balance sheet amount for inventory is likely to approximate the current market value

its flow of cost is in sequence with the flow of stock: since the first stock will be considered for sale before other stock. the cost is always in sequence with the flow of stock because it correspondence with the normal physical flow of goods
28
Discount allowed is enjoyed by
A
Managers
B
Customers
C
Suppliers
D
Staff of the company
CORRECT OPTION: b
Customer: customers are the one that enjoys discount allowed. It is allowed to them by the suppliers. it can be in cash or trade
29
\(\begin{array}{c|c} & \text{Dept A} & \text{Dept B} \ \hline & N & \ \hline \text{Sales} & 250 000 & 150,000 \ \hline \text{Purchases} & 500,000 & 250 000 \ \hline \text{Discount received} & 24 000 & \ \hline \text{Discount allowed} & 15 000 & &
\end{array}\)

Determine the discount allowed by Department A
A
₦5,000
B
₦9,375
C
₦5,625
D
₦8,000
CORRECT OPTION: b
To determine the discount allowed by Department A, the percentage of sales by Department A need to be calculated

Dep A 250,000

Dep B \(\frac{150,000}{400,000}\)

% of Dep A = \(\frac{250,000}{400000}\) X 100

= 62.5%

∴ Discount allowed in Dep A = \(\frac{62.5}{100}\) x 250,000

= ₦ 9,375

= ₦ 9,375
30
The accounting entries for goods stolen in branch will be to debit
A
The accounting entries for goods stolen in branch will be to debit
B
branch stock account and credit branch adjustment account
C
branch adjustment account and credit profit and loss account
D
branch adjustment account and credit branch stock account
CORRECT OPTION: a
A branch account is a small part of business account operating with some degree of independence . It maintains its own personal/self accounting entries to determine the profit/loss made by a specific period of time

The accounting entries is to debit profit and loss account and credit branch stock. The profit and loss is debited because the cost of the stolen goods must be charged against the profit for the period to balance the account and the branch stock account is credited because the cost of the goods is out of the branch already.
Pages: