Tunde and Bola formed T&B Associates. Tunde contributed ₦25,000 cash, ₦45,000 equipment, ₦80,000 van. Bola contributed ₦15,000 cash, ₦90,000 shop, ₦20,000 furniture. What is the total capital?
Tunde: ₦25,000 + ₦45,000 + ₦80,000 = ₦150,000. Bola: ₦15,000 + ₦90,000 + ₦20,000 = ₦125,000. Total = ₦275,000 (B).
Tunde and Bola’s profit-sharing ratio based on capital contributions is
Tunde: ₦150,000, Bola: ₦125,000. Ratio = 150,000:125,000 = 6:5 (B).
A key benefit of a general journal is that it
The general journal records transactions in chronological order.
The purpose of a balance sheet is to
A balance sheet details assets, liabilities, and capital at a specific date.
Debtors: opening ₦8,500, closing ₦9,200; cash received ₦42,000, bad debts ₦300. What is total sales?
₦9,200 = ₦8,500 + Sales - ₦42,000 - ₦300. Sales = ₦43,000 (A).
Opening capital ₦15,000, drawings ₦2,500, closing capital ₦22,000, additional capital ₦5,000. What is the profit?
Profit = ₦22,000 - ₦15,000 + ₦2,500 - ₦5,000 = ₦9,500 (C).
With 5% interest on opening capital of ₦15,000, what is the interest?
Interest = 5% × ₦15,000 = ₦750 (A).
Kemi Enterprises purchased a computer system, recorded as
A computer is a long-term fixed asset.
Chidi and Nkechi’s appropriation: Chidi (Interest ₦600, Salary ₦1,200, Profit ₦2,500), Nkechi (₦400, ₦800, ₦2,500). What is net profit?
Chidi: ₦4,300, Nkechi: ₦3,700. Net profit = ₦4,300 + ₦3,700 = ₦8,000 (B).
To dissolve a partnership and form a sole proprietorship, Aminu and Zainab must
Partnership dissolution requires transferring assets to the new owner.
The most suitable cash book for a small trader with limited banking is
A single-column cash book tracks only cash transactions, ideal for simplicity.
Columns in a sales day book include
Sales day book records credit sales with date, particulars, invoice, amount.
Machinery ₦120,000, Sales ₦250,000, Inventory ₦45,000, Wages ₦50,000, Purchases ₦150,000, Capital ₦150,000, Creditors ₦20,000, Rent ₦15,000, Debtors ₦30,000. What is the cash balance?
Assets = Liabilities + Capital. Assets = ₦195,000 + Cash. Liabilities + Capital = ₦205,000. Cash = ₦20,000 (B).
What is the trial balance total for the above data?
Debits: ₦430,000, Credits: ₦430,000. Total = ₦430,000 (B).
Share capital ₦150,000, Reserves ₦30,000. What is the owners’ invested capital?
Invested capital is share capital, ₦150,000 (B).
Creditors ₦20,000, Bank overdraft ₦10,000. What is Zainab Ltd’s total liabilities?
Liabilities = ₦20,000 + ₦10,000 = ₦30,000 (B).
Capital ₦12,000, Cash ₦4,000, Purchases ₦6,000, Sales ₦14,000, Inventory ₦3,000, Creditors ₦3,000, Fixed assets ₦7,000, Drawings ₦2,000. What is the trial balance total?
Debits: ₦22,000, Credits: ₦22,000. Total = ₦22,000 (A).
Cash ₦2,000, Inventory ₦1,500, Debtors ₦1,000, Creditors ₦1,200, Bank overdraft ₦800. What is the working capital?
Working capital = ₦4,500 - ₦2,000 = ₦2,500 (A).
Aisha’s business: warehouse ₦60,000, inventory ₦10,000, profit ₦18,000, closing capital ₦80,000. What are her drawings?
Drawings = ₦70,000 + ₦18,000 - ₦80,000 = ₦8,000 (A).
The provision for doubtful debts balance is
Provision for doubtful debts is deducted from debtors on the balance sheet.
The correct sequence for preparing financial statements is
Ledger to trial balance to financial statements is the correct sequence.
Mrs. Ade recorded rent in the purchases account, an error of
Recording an expense in a goods account is an error of principle.
Cash basis accounting records
Cash basis records revenues and expenses when cash changes hands.
A public limited company differs because it
Public companies can offer shares to the public.
In a charitable organization, the income and expenditure account is similar to
It shows surplus or deficit, like a profit and loss account.
Emeka and Obi (2:1 ratio) admit Uche, new ratio 1:1:1. Uche pays ₦15,000 goodwill. How is it treated?
Goodwill is credited to old partners in their old ratio (2:1).
Bank charges on a savings account are based on
Charges often depend on withdrawal frequency.
The technology enabling POS transactions is the
Magnetic strip contains account details for POS processing.
Tayo Enterprises: Opening stock ₦8,000, Sales ₦150,000, Closing stock ₦7,000, 20% gross profit margin. What is cost of goods sold?
Gross profit = 20% × ₦150,000 = ₦30,000. Cost of goods sold = ₦150,000 - ₦30,000 = ₦120,000 (A).
Purchases for Tayo Enterprises with above data are
Cost of goods sold = ₦8,000 + Purchases - ₦7,000. ₦120,000 = ₦1,000 + Purchases. Purchases = ₦119,000 (B).
A discrepancy understating the cash book balance is caused by
Unrecorded bank charges reduce the cash book balance.
A ledger’s key characteristic is that it
A ledger organizes transactions into specific accounts.
Inventory ₦25,000, Sales ₦400,000, Purchases ₦300,000, Cost of goods sold ₦290,000, Salaries ₦40,000. What is gross profit?
Gross profit = ₦400,000 - ₦290,000 = ₦110,000 (A).
Net profit for the above data is
Net profit = ₦110,000 - ₦40,000 = ₦70,000 (A).
Which is a revenue expenditure?
Salaries are day-to-day revenue expenditures.
The profit and loss account shows
It determines net profit or loss for the period.
Vehicle cost ₦120,000, scrap value ₦20,000, 4-year life. Annual depreciation (straight-line) is
Depreciation = (₦120,000 - ₦20,000) / 4 = ₦25,000 (A).
Current assets ₦180,000, current liabilities ₦60,000. What is the current ratio?
Current ratio = ₦180,000 / ₦60,000 = 3.0:1 (A).
The quick ratio excludes which current asset?
Quick ratio excludes inventory, focusing on liquid assets.
A petty cash book is used to record
Petty cash book tracks small, routine expenses.
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