Principles Of Accounts 2006 Jamb Examination
Question 11
The Constitution stipulates that the Auditor General must submit his report to the National Assembly within 90 days of receiving the financial statements. Correct option is D.
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Question 12
Gross earnings........................N950 000
Current liabilities...................N100 000
Operating expenses....................N350 000
10% debentures........................N400 000
Shareholder's fund....................N1300 000
Corporate tax is 30%
From the data above calculate the returns on equity?
Gross earnings = 950,000. Operating expenses = 350,000. EBIT = 600,000. Debenture interest = 40,000. Profit before tax = 560,000. Tax (30%) = 168,000. Net profit = 392,000. Return on equity = (392,000 ÷ 1,300,000) × 100 = 30%.
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Question 13
Use the information below to answer questions
Turnover...........................N120 000
Net profit before tax..............N40 000
Net profit b/f.....................N68 000
Proposed dividends:
Ordinary shares....................N8 000
Preference shares..................N6 000
Corporate tax is 30%...............N10 000
The undistributed profit carried forward is?
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Question 14
Accrual accounting records income when earned and expenses when incurred, regardless of cash. It recognizes both debtors and creditors. Correct option is B.
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Question 15
Use the information below to answer questions Turnover...........................N120 000 Net profit before tax..............N40 000 Net profit b/f.....................N68 000 Proposed dividends: Ordinary shares....................N8 000 Preference shares..................N6 000 Corporate tax is 30%...............N10 000
What is the tax charged to profit and loss account?
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Question 16
A private company is different from a public company because?
A private company differs from a public company because it cannot invite members of the public to subscribe for its shares, while a public company can. This is a legal restriction under company law.
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Question 17
The use of a three-column cash book is determine by?
A three-column cash book records cash, bank, and discounts. The discount column is the main feature that necessitates a three-column cash book. Hence, cash discounts determine its use.
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Question 18
A major factor that enhanced the early development of accounting is the?
The early development of accounting was largely driven by the growing of trade and commerce, which created the need to keep proper records of transactions.
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Question 19
Which of the following is source of document for the preparation of debtors' ledger account?
The source document for preparing the debtors' ledger is the sales invoice because it shows goods sold on credit to customers.
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Question 20
Stationary which will be used over a long period of time is usually recorded as an expense instead of an asset. This concept is called?
Stationery is relatively insignificant in value; hence, for convenience, it is recorded as an expense rather than an asset. This treatment is based on the materiality concept.