Exam Questions Second Term SSS 2 Accounting

S S ACCOUNTING

1. 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

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

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

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

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

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

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

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

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

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

Which of the following transactions will result in disagreement between the cash book and the bank statements?

A. selling of goods on credit to a customer

B. withdrawal of goods by the proprietor for his personel use

C. cheque paid directly into the bank account by a customer

D. omission of purchase of purchases received from a supplier on credit

12

Purchase account is overcast by ₦200, while wages account is undercast by ₦200. This is

A. an error of omission

B. a compensating error

C. an error of commision

D. an error of principal

13

Which of the following is used to record the disposal of a fixed asset?

A. journal proper

B. petty cash book

C. sales day book

D. purchase day book

14

An error of principle is made, if

A. an entry has been made on the wrong class of account

B. a ransaction has been completely omitted

C. an entry has been made on the wrong side of the two accounts corcened

D. a transaction is entered in both accounts for the wrong amount

15

Which of the following is entered in the general journal?

A. purchase of goods

B. sale of goods on credit

C. returns inward

D. aquisition of fixed assets

which of the following is not an administrative expenses in a manufacturing organization?

A. discounts allowed

B. office electricity

C. stationery

D. insurance

22

Which of the following items is not contained in the Receipts and Payments Account?

A. Subscription paid in advance

B. stock paid for in advance

C. outstanding wages and salaries

D. donations

23

The accounting concept underlying the treatment of personal expenses of the business owner as drawing is

A. periodicity

B. accrual

C. entity

D. materiality

24

The sum of direct cost in a manufacturing account is

A. production cost

B. prime cost

C. total cost

D. finance cost

25

When an asset is sold, the entries for the accumulated depreciation are; debit

A. assets disposal account; credit provision for depreciation account

B. provision for depreciation account; credit asset disposal account

C. fixed asset account; credit asset disposal account

D. asset disposal account; credit fixed asset account

An example of input devices of a computer is

A. an optical character reader

B. a graph plotter

C. a visual display unit

D. a printer

38

The accounting concept which states that expenditure involving insignificant amounts should be regarded as expenses and not assets is

A. business entity

B. materiality

C. dual aspect

D. realization

39

A company made a net profit of ₦2,000,000 for the year and its net profit percentage is 25%. What is the total sales for the year?

A. ₦8,000000

B. ₦6,00000

C. 800,000

D. ₦500,000

40

Which of the following information is recorded in the returns outwards book?

A. goods purchased on credit and susequently returned to suppliers

B. fixed asset bought on credit and subsequently returned to supplier

C. cash payment received from a customer and subsequently returned to supplier

D. goods sold to a customer and subsequently returned to the business

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

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

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

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

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

«

An advantage of using accounting ratios is that they

A. can be easily calculated

B. facilitate decision making

C. are stipulated by law

D. shows error and fraud

32

The expenditure on a good or services which is consumed either immediately or within a current accounting period is called

A. fixed expenditure

B. capital expenditure

C. annual expenditure

D. recurrent expenditure

33

The receipt from a special tax levy to pay maturing interest obligation are recorded in

A. capital fund project

B. Debt Service Fund

C. Tax Assessment Fund

D. Special Revenue Fund

34

The cash bass of accounting requires the recognition of revenue only when they are

A. due

B. earned

C. paid

D. received

35

The amount of individual items on a government budget is called

A. vote

B. deposit

C. loan

D. grant