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jamb2024accounting
Q1. A person who prepares, analyses and interprets financial statements is known as a/an
Acashier
Bbook keeper
Caccountant
Danalyst
Correct Answer: C
An accountant reviews and analyses financial records, keeping track of a company's or individual's income, expenditures, and tax liabilities. An accountant may also be involved in project planning, cost analysis, auditing, and financial decision-making.
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Q2. Which of the following bodies regulates accounting practices in Nigeria?
ANIT
BNIB
CEFCC
DANAN
Correct Answer: D
In Nigeria, there are two main professional accountancy associations with regulatory power:
Institute of Chartered Accountants of Nigeria (ICAN): This is the older and more widely recognized body. Association of National Accountants of Nigeria (ANAN): This is another recognized professional accountancy body.
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Q3. A method that is beneficial for tax purposes in inflationary times is?
ALIFO
BSAP
CFIFO
DWAP
Correct Answer: A
This method assumes the last items purchased are the first ones sold. It can result in a higher COGS during periods of inflation, potentially leading to lower reported profits. LIFO can be beneficial for tax purposes in inflationary times.
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Q4. In government accounting, money allocated to each head and sub-heads is referred to as
Aallocation
Bimprest
Cvote
Dfloat
Correct Answer: C
In government budgeting, funds are authorized for spending through a voting process. Each government department or agency submits a budget request, which is then debated and approved (or voted on) by the legislature. The approved amounts for each department's programs and activities become the official votes that they can spend from.
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Q5. Goods bought on credit are first entered in the
Acash book
Bjournal proper
Csales day book
Dpurchases day book
Correct Answer: D
The purchases day book is a subsidiary book specifically designed to record all credit purchases made by a company. It chronologically logs details like the date, supplier name, invoice number, description of goods, and amount of the purchase. This information is then summarized and posted to the purchases account in the genera ledger at the end of the accounting period.
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Q6. A company has current assets worth N100,000 and current liabilities worth N50,000. What is the current ratio?
A1:1
B2:1
C3:1
D4:1
Correct Answer: B
Current ratio = Current assets / Current liabilities = N100,000 / N50,000 = 2:1, indicating the company’s ability to cover short-term obligations.
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Q7. A cash book shows a balance of N10,000. Bank charges of N400 and a standing order of N300 are not yet recorded. What is the adjusted cash book balance?
AN9,300
BN9,600
CN10,300
DN10,700
Correct Answer: A
Adjusted cash book balance = Cash book balance (N10,000) - Bank charges (N400) - Standing order (N300) = N9,300.
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Q8. The statement of assets and liabilities in the public sector can be described as the
Aincome and expenditure account of government
Bappropriation account of government
Cbalance sheet of government
Dfunds flow statement of government
Correct Answer: C
The statement of assets and liabilities in the public sector is equivalent to a balance sheet, showing the government’s financial position at a point in time.
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Q9. A company purchases an asset worth N80,000 with a useful life of 4 years. What is the annual depreciation using the straight-line method?
AN15,000
BN20,000
CN25,000
DN30,000
Correct Answer: B
Annual depreciation = Cost / Useful life = N80,000 / 4 = N20,000, assuming no residual value.
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Q10. A dividend of 9% in a company on 500,000 ordinary shares of N1 nominal value has been declared. How much will a shareholder receive if he has 200 shares?
AN18
BN20
CN22
DN24
Correct Answer: A
Dividend per share = 9% of N1 = N0.09. For 200 shares, dividend = 200 × N0.09 = N18.
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Q11. What is the accounting equation?
AAssets = Liabilities + Equity
BAssets = Liabilities - Equity
CAssets = Equity - Liabilities
DLiabilities = Assets + Equity
Correct Answer: A
The accounting equation, Assets = Liabilities + Equity, ensures the balance sheet remains balanced in double-entry bookkeeping.
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Q12. A manufacturing business has direct materials costing N1,500 and direct labor costing N500. What is the prime cost of goods manufactured?
AN1,800
BN2,000
CN2,200
DN2,400
Correct Answer: B
Prime cost = Direct materials (N1,500) + Direct labor (N500) = N2,000, excluding overheads.
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Q13. The loss of equipment in a fire disaster results in
Aa decrease in current assets
Ban increase in liabilities and assets
Ca decrease in assets and capital
Dan increase in liabilities and a decrease in assets
Correct Answer: C
The loss of equipment reduces assets (non-current assets) and capital (via profit reduction or direct capital adjustment).
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Q14. A club has subscriptions of N20,000 and expenses of N15,000 for the year. What is the surplus for the year?
AN3,000
BN5,000
CN10,000
DN15,000
Correct Answer: B
Surplus = Income (subscriptions, N20,000) - Expenses (N15,000) = N5,000, typical for non-profit organizations.
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Q15. The sales ledger control account has an opening balance of N20,000. Credit sales are N30,000, and cash received from debtors is N25,000. What is the closing balance?
Q16. What is the formula for calculating net profit margin?
ANet profit / Sales
BGross profit / Sales
COperating profit / Sales
DNet profit / Total assets
Correct Answer: A
Net profit margin = Net profit / Sales, expressed as a percentage, measures profitability relative to revenue.
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Q17. A business produces goods with a market value of N4,000. What is the market value of goods produced?
AN3,000
BN3,500
CN4,000
DN4,500
Correct Answer: C
The market value of goods produced is directly given as N4,000, as stated in the question.
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Q18. Share premium is an example of
Arevenue reserves
Bcapital reserves
Cgeneral reserves
Dloan capital
Correct Answer: B
Share premium, arising from issuing shares above nominal value, is a capital reserve, not distributable as dividends.
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Q19. A company has sales of N300,000, cost of goods sold of N180,000, and operating expenses of N50,000. What is the net profit?
AN20,000
BN30,000
CN70,000
DN120,000
Correct Answer: C
Net profit = Sales (N300,000) - Cost of goods sold (N180,000) - Operating expenses (N50,000) = N70,000.
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Q20. State Bank collected a note for Al-Makura Company. This collection, not yet recorded in Al-Makura’s books, appears on the bank reconciliation as
Aan addition to the balance per books
Ba deduction from the balance per bank statement
Can addition to the balance per bank statement
Da deduction from the balance per books
Correct Answer: A
A note collected by the bank increases the cash book balance but isn’t recorded yet, so it’s added to the balance per books during reconciliation.
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Q21. A source document used for verifying the amount due to creditors is
Ainvoice
Breceipt
Ccredit note
Ddebit note
Correct Answer: A
An invoice details goods or services provided and the amount owed, serving as the primary document to verify amounts due to creditors.
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Q22. A manufacturing business incurs factory rent of N3,000, factory lighting of N2,000, and depreciation of machinery of N1,000. What is the total factory overhead?
Q28. A.S.D. Club Balance Sheet [Extract]: Accumulated fund N6,000. What is the opening balance on the consolidated fund account?
AN6,000
BN10,000
CN12,000
DN11,000
Correct Answer: A
The opening balance on the consolidated fund account is the accumulated fund, N6,000, as stated in the balance sheet extract.
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Q29. Nasara Manufacturing Plc has three direct labour employees working 40 hours each a week for 50 weeks. Factory overhead costs of N60,000 are distributed based on direct labour hours. Compute the overhead rate per hour.
Accounting records transactions, prepares financial statements, and analyzes performance for decision-making, encompassing all listed purposes.
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Q31. A company has 5% debentures worth N500,000, ordinary capital N2,000,000, and preference shares N1,500,000. If the company made a profit of N1,000,000, the debenture interest would amount to
AN1,000,000
BN500,000
CN250,000
DN25,000
Correct Answer: D
Debenture interest = 5% of N500,000 = N25,000, paid before profit distribution, as debentures are fixed-income liabilities.
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Q32. The purchases ledger control account has an opening balance of N15,000. Credit purchases are N25,000, and payments to creditors are N20,000. What is the closing balance?
Q33. Faruk and Osawe are in partnership sharing profits and losses in the ratio of 3:7. Faruk is to receive a salary of N1,500 (before deduction of Faruk’s salary). The appropriate distribution of the net loss would be
AFaruk (N450), Osawe (N1,050)
BFaruk (N3,150), Osawe (N7,350)
CFaruk (N2,250), Osawe (N5,250)
DFaruk (N1,500), Osawe (N3,500)
Correct Answer: A
Faruk’s salary (N1,500) is deducted first, then the remaining net loss is shared 3:7. Total loss = N1,500, so Faruk’s share = 3/10 × N1,500 = N450; Osawe’s share = 7/10 × N1,500 = N1,050.
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Q34. Stock of raw materials (1st January) N3,000, Direct wages N2,500, Direct expenses N1,000, Cost of raw materials used N5,000. Determine the prime cost.
AN8,500
BN7,500
CN9,000
DN8,000
Correct Answer: A
Prime cost = Cost of raw materials used (N5,000) + Direct wages (N2,500) + Direct expenses (N1,000) = N8,500.
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Q35. A business purchases 200 units at N40 each and later 300 units at N50 each. If 400 units are sold, what is the value of closing stock using the FIFO method?
AN5,000
BN6,000
CN7,000
DN8,000
Correct Answer: A
FIFO: Sell 200 units at N40 and 200 units at N50. Closing stock = 100 units at N50 = 100 × N50 = N5,000.
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Q36. According to the provisions of the 1999 constitution, all revenue generated by the Federal Government must be paid into the
Aconsolidated revenue fund
Bfederation account
Crevenue mobilization allocation and fiscal commission account
Dequalization fund
Correct Answer: A
The 1999 Constitution mandates that all federal revenue be paid into the Consolidated Revenue Fund for proper allocation.
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Q37. Income and Expenditure Account: Wages N12,000, Subscriptions received N20,000, Electricity N5,000, Donations received N10,000, Depreciation N1,000, Profits on sale of investment N5,000, Other expenses N4,500. Determine the club’s excess of income over expenditure.
AN12,500
BN12,000
CN15,000
DN14,500
Correct Answer: A
Income = Subscriptions (N20,000) + Donations (N10,000) + Profits on sale (N5,000) = N35,000. Expenses = Wages (N12,000) + Electricity (N5,000) + Depreciation (N1,000) + Other expenses (N4,500) = N22,500. Excess = N35,000 - N22,500 = N12,500.
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Q38. Given: Cash purchases N25,000, Closing balance of trade creditors N45,000, Opening balance of trade creditors N35,000. Calculate the purchases for the period.
Q39. The accounting principle that is applied to check arbitrary actions on the part of accountants is
AConsistency
BMateriality
CObjectivity
DRealization
Correct Answer: C
Objectivity ensures accounting records are based on verifiable evidence, preventing arbitrary or subjective actions by accountants.
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Q40. On partnership dissolution, if a partner’s capital account has a debit balance and the partner is insolvent, the deficiency will, in accordance with the decision of the case of Garner v. Murray, be
Aborne by all the partners
Bborne by the insolvent partner
Cwritten off
Dborne by the solvent partners
Correct Answer: D
Per Garner v. Murray, the deficiency of an insolvent partner’s capital account is borne by solvent partners in their profit-sharing ratio.
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Q41. Erro’s Trading Account for the month ended 31/05/2001: Sales N161,000, Purchases N110,000, Returns N4,000, Closing stock N149,000, Gross profit ratio 25%, Total expenses N20,845. What is the net profit for the month?
AN19,405
BN19,149
CN16,168
DN21,655
Correct Answer: A
Gross profit = 25% of Sales (N161,000) = N40,250. Net profit = Gross profit (N40,250) - Expenses (N20,845) = N19,405.
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Q42. Which of the following is a type of financial statement?
ABalance Sheet
BIncome Statement
CCash Flow Statement
DAll of the above
Correct Answer: D
Financial statements include the Balance Sheet (financial position), Income Statement (performance), and Cash Flow Statement (cash movements).
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Q43. Statement of Assets and Liabilities as at 31st December, 2001: Current liabilities N20,000, Current assets N110,000. What is the net working capital?
AN90,000
BN70,000
CN100,000
DN80,000
Correct Answer: A
Net working capital = Current assets (N110,000) - Current liabilities (N20,000) = N90,000.
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Q44. A business incurs an expense of N12,000 for electricity used in December but pays it in January. According to the accrual concept, this expense should be recorded in
AJanuary’s financial statements
BDecember’s financial statements
Cthe cash book only
Dthe following year’s budget
Correct Answer: B
The accrual concept requires expenses to be recorded in the period they are incurred (December), not when paid (January), ensuring accurate financial reporting.
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Q45. Income and Expenditure Account: Wages N12,000, Subscriptions received N20,000, Electricity N5,000, Donations received N10,000, Depreciation N1,000, Profits on sale of investment N5,000, Other expenses N4,500. What is the amount to be written off as other expenses?
AN4,500
BN6,000
CN4,000
DN5,000
Correct Answer: A
The other expenses are directly given as N4,500 in the income and expenditure account, to be written off as stated.
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Q46. The reward given to debenture holder is
Ainterest
Bdividend
Cprofit
Dpremium
Correct Answer: A
Debentures are long-term debt instruments issued by companies to raise funds. Debenture holders are the creditors of the company, and they receive regular interest payments as a reward for lending their money to the company.
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Q47. Based on the following information, calculate the raw materials available for production:
Opening stock of raw materials on 1/1/09 was ₦2,000, work-in-progress was ₦5,000, closing stock of raw materials on 31/12/09 was ₦500, work-in-progress was ₦4,000, raw materials purchased during the year was ₦18,000, direct labour was ₦7,500, direct expenses were ₦3,000, and factory expenses were ₦10,000.
A₦18,000
B₦20,000
C₦19,500
D₦38,000
Correct Answer: B
To find the raw materials available for production, we use the formula:
Raw Materials Available for Production = Opening Stock of Raw Materials + Raw Materials Purchased
Raw Materials Available for Production = ₦2,000 + ₦18,000 = ₦20,000
This represents the total value of raw materials that were available to be used in the production process during the year.
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Q48. When manufactured goods are transferred to the trading account at the market price, the difference is credited to the
Amanufacturing account
Bbalance sheet
Ctrading account
Dprofit and loss account
Correct Answer: D
When manufactured goods are transferred to the trading account at market price (which is higher than the cost of production), the difference represents an unrealized profit on the manufactured goods.
This difference is credited to the profit and loss account as "Unrealized Profit on Manufacturing" or "Profit on Manufacturing."