Financial Accounting Mock Exams SS 3

FINANCIAL ACCOUNTING

1. Where there is no partnership agreement the Partnership Act 1890 section should be applied (a) 20 (b) 25 (c) 24 (d) 34

3. Which of the following is not true where there is no laid down agreement for the partnership? (a) Profits and losses to be shared equally (b) No interest on drawings (c) No interest in capital (d) Members of the public can invest in the shares of the business.

4. Which of the following increases the profit of a partnership? (a) Drawings (b) Interest on capital (c) Interest on drawings (d) Partnership salary

5. Which of the following statements is NOT true? (a) When we keep fixed capital accounts for partners we open their current accounts (b) When losses are made they are to be shared by the partners (c) When we keep floating capital account no current account is kept (d) A partnership can exist forever.

6. Which of the following can represent capital contributed by a partner to a partnership?

(a) Cash only (b) Cheques only (c) Cash and cheques only (d) Cash, cheque and other assets.

7. Use the following information to answer questions 1 – 5. A, B, and C are in partnership sharing profits and losses in the ratio 3:2:1 respectively. Their capital accounts are A: N60,000 B. N40,000 and C: N 30,000. Interest on capital is agreed at 5% p.a. interest on drawings is also agreed at 5% p.a. Their drawings for the year are: A: N 6,000 B: N 4,000 and C: N 3,000. The profit for the year before appropriation is N 30,000 C is entitled to a partnership salary of N2,000 p.a

8. What is the total of A and B’s interest on capital? (a) N4,000 (b) N3,000 (c)

N5,000

(d) N10,000

9. What is the total of B and C’s interest on drawing? (a) N350 (b) N250, (c) N450

(d) N400

10. Total interest on the partners’ capital for the year is (a) N7,000 (b) N6,000 (c) N6,500 (d) N5,500

11. Total credit entries in the appropriation account is (a) N550 (b) N30,000 (c)

N35,500 (d) N30,550

12. Which of the following is not debited to the profit and loss appropriation account?

i. C’s salary (b) Partner’s interest on capital (c) Share of profit (d) Share of loss

13. The double entry for the N5,000 salary paid to partner A is (a) Dr. Appropriation A/c N5,000, Cr A’s current A/c N5,000 (b) Dr. A’s Capital A/c N5,000,

14. Cr Appropriation A/c N5,000 (c) Cr Revaluation A/c N5,000; Dr. Salary A/c N5,000

(d) None of the above

15.. Goodwill is (a) Fixed Asset (b) Current Asset (c) Current Liability (d) Intangible Asset

16.. Goodwill can be classified into (a) Liquid (b) tangible (c) intangible (d) Inherent and purchased

17. A/c is credited with increase in values of assets (a) goodwill

(b) capital (c) revaluation (d) current

18. For a reduction in the value of an asset the asset A/c and debit Revaluation A/c (a) debit (b) credit (c) deduct (d) Add

19. The double entry for discount received from creditors on dissolution is (a) Cr. creditor A/c Dr. Cash A/c (b) Cr. Creditors A/c, Dr. Cash (c) Cr. realization A/c; Dr. Creditors (d) Dr. Bank, Cr. Capital A/c

20. Loss on an asset realized is debited to realization A/c and credited to A/c (a) Cash (b) Asset (c) Realization (d) Revaluation

21. Assets taken over by partners on dissolution are credited to realization A/c and debited

(a) asset A/c (b) cash A/c (c) Capital A/c (d) all of the above

22. Discount allowed is debited to A/c (a) capital (b) realization (c) current (d) P & L

23. For goodwill on dissolution debit A/c and credit A/c respectively (a) cash and capital (b) goodwill and realization (c) realization and goodwill (d) capitasl and cash

24. When a company can sue in its own name and right, we say it possesses (a) legal entity

(b) legal jargons (c) legal portfolio (d) legal value

25. The company whose liabilities of its owners are limited to the value of share bought in the company is called (a) limited by share (b) limited by guarantee

26.(c) unlimited by share (d) limited by decree

27. The amount of capital a company is allowed to raised in the capital market is

28. authorized capital (b) issue capital (c) called up capital (d) un-issued capital

29. The name of private limited company ends with (a) Ltd (b) Plc (c) & co (d) Ent.

30. The name of public limited company ends with (a) Corporation (b) Ltd (c) Plc (d) Authority

31. Net purchase in trading account is (a)purchases –return outwards (b)

purchases – return inward (c)purchases – carriage inwards (d) purchases – sales

32. Net sales in trading account is ————– (a)purchases – sales (b)sales – return inwards (c)sales – return outwards (d) sales + purchases

33. Working capital is (a)current assets – current liabilities ( b) current liabilities –

current assets (c) total current assets (d) current assets + stock

34. Capital owned is (a)current assets – total liabilities (b) total assets – total

liabilities (c) total assets + total capital (d) current assets + stock

35. Capital employed is (a)total assets – current liabilities (b)total assets – total

liabilities (c ) total liabilities + all assets (d) current assets + current liabilities

36. When a company received application for shares fewer than available for sale, the share is said to be a) oversubscribed b) under-subscribed c)subscription at par (d) forfeited

37. When a company received application for more than available shares for sales, the share is said to be (a) ever-subscribed (b) under- subscribed (c) over- subscribed (d) cancelled

38. On shares issued at par on application and fully paid, the accounting entries on receipts of money are (a) debit bank and credit application (b)debit application and credit bank

39. Based on question 3 above ,the accounting entries on allotment of shares are (a) debit ordinary share capital account and credit application account (b)debit application account and credit ordinary shares capital account (c) debit premium and credit application account(d) debit ordinary shares credit bank

40. A share issued below the nominal value is said to be issued at (a) discount (b) premium

THEORY

On 1st February 1989 ABC plc makes an issue of 15,000 ordinary shares of nominal value of ₦2 at ₦3. Application money were received for exactly 15,000 shares.

Show:

a. Journal entries

b. Ledger accounts

THEORY

1. What is bonus issue?

2. Enumerate five features of private limited company.

THEORY

1. Mention four documents that must be sent to Corporate Affairs Commission before a company can be register.

2. What is a prospectus.

THEORY

1. Explain how the proceeds of assets realized is applied in partnership dissolution.

2. Provide the double entries for the following on dissolution of the partnership of XYZ.

(a) Discount allowed to debtors N500

(b) Cars taken over by Z N50, 000

(d) Y brings cash to meet his deficit N5000

(e) Discount received N2000

THEORY

1. Explain clearly but briefly the terms goodwill and revaluation of assets. Why and when are they necessary in accounting?

THEORY

1. Write short notes on (a) Interest on capital (b) Interest on drawing

2. Give the double entries for the following in the final account of a partnership. (i) Interest on drawings N500 (ii) Partnership salary N3,000 (iii) Interest on capital N5,000 (iv) Share of profit N10,000

THEORY

1) List the rules approved by the Partnership Act 1890 to be applied where there is no partnership agreement.

2) Prepare the capital and current accounts of the following partners:-

Capital accounts Obi

Oba 50, 000 cr.

20, 000 cr.

Interest in capital 5% p.a.

Salaries Obi 5, 000

Oba 6, 000

Interest on drawings 5%

Drawings Obi 2, 000

Oba 1, 500

Current accounts balances b/f

Obi 3, 000 cr.

Oba 500 dr.

Tags:Financial Accounting SS1 First Term Lesson Notes

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