FINANCIAL ACCOUNTING SS 1 SECOND TERM EXAMINATION

FINANCIAL ACCOUNTING SS 1

1. The systematic recording of business transactions in monetary term is ________. (a) auditing (b)book keeping (c) debiting (d) crediting
2. Which of the following is not a purpose of financial accounting? (a) Determining profit. (b) Fixing prices. (c) Credit dealings. (d) Determining cash balance.
3. The double entry principle of accounting was developed by (a) Frank Wood (b) Akintola Williams (c)Rev. Luca Pecioli (d) Williams Pickles
4. The two fundamental books of account are (a) cash book and petty cash book. (b) receipt and invoice. (c) journal and ledger. (d)notes and coins.
5. Which of the following is the principal book of account? (a) General journal (b)Sales book (c) Purchases book (d) Ledger
6. The process of entering transactions from one book to another is ________. (a) reading (b) posting (c) numbering (d) casting
7. A ledger is a (a) summary of a entries. (b)book of original entry. (c)book of account. (d) double entry posting.
8. A trader set aside from his private funds #70, 000 for business purpose. The #70, 000.00 would be referred to as _________. (a)drawings (b) profit (c) capital (d) loans
9. Purchases in accounting refers to goods bought for __________. (a) repairs (b) permanent use (c) resale (d) owner’s use
10. When goods are sold for cash, the credit entry goes to the _________. (a) trader’s account (b) cash account (c) customer’s account (d)sales account
11. An account is said to have a debit balance because (a) the first entry made in was on the debit side. (b)there are more entries in the debit side than on the credit side. (c) total value of debit entries is more than total value of credit entries. (d) there is no entry at all on the debit side.
12. A customer has been charged #152 for a purchase instead of#134.00. The document issued by the seller to correct the error is ____________. (a) a credit note (b) a debit note (c) an invoice (d)a statement of account
13. Which of the following is a source of document for recording sales? (a) debit note (b) Credit note (c)Sales journal (d) Invoice
14. When a buyer is under- charged, the seller forwards _________. (a)a debit note (b)a credit note (c)an invoice (d)a payment receipt
15. Which of the following is not a source of document? (a) Credit note (b) Invoice (c) Bank note (d) Debit note
16. Which of the following is entered in the general journal? (a) Purchase of goods. (b)Sales of goods on credit. (c) Return inwards (d) Acquisition of fixed assets.
17. A sales journal is used to record _______. (a)cash sales (b) credit sales (c)sales expenses (d)sales returns
18. The lodgement of business cash into the business bank account is an example of _________. (a)bank reconciliation (b)self balancing ledger (c)contra entry (d) reversal entry
19. Nwoye buys goods and pays by cheque. The entries in the books of Nwoye is debit (a) purchases; credit cheque. (b) purchases; credit bank. (c)bank; credit purchases. (d) cheques; credit purchases.
20. Which of the following is NOT a branch of Accounting? (a) Financial Accounting. (b) Cost Accounting (c) Social Accounting (d) Management Account

THEORY

1a. What is financial accounting?

1. State any two difference between book keeping and accounting.
2. Mention any five (5) users of accounting information or financial statement.

2a. What are source documents?

1. State any two (2) uses of source documents.
2. Differentiate between debit note and credit note.

Dan Jumbo started business on 7/1/94 with the following:

#

Building.                                                     100,000

Stock of goods.                                           40,000

Motor van                                                     50,000

Cash.                                                             10,000

During the month he undertook the following transactions;

#

5/1/94.   Sold goods for cash.                    5,000

10/1/94  Sold goods for credit.                20,000

12/1/94.  Bought goods on credit.           10,000

15/1/94. Cash sales banked.                    15,000

16/1/94. Paid cash for office stationary.  2,000

20/1/94. Received cash from debtors

of goods.                                             5,000

22/1/94  Paid cash for office expenses.             1, 000

23/1/94  Paid salary by cheque.                           4, 000

24/1/94  Sold goods for cash.                               7,000

25/1/94. Sold goods on credit.                              5,000

26/1/94. Bought goods on credit.                         5,000

27/1/94. Bought goods for cash.                          2,500

28/1/94. Withdraw money from bank for

owners use.                                               1,500

29/1/94.  Office cash banked.                                5,000

30/1/94.  Paid electricity by cheque.                     1,500

3a. What are the appropriate books of original entry into which the above would be recorded?

3b. You are required to record the above transactions into the appropriate books of original entry.                                                                                                                                              [WAEC]