Accounting Questions & Answers - Free Online Practice

841.

Where fixed capitals are maintained in a partnership, share profits are

Credited to partners capital accounts

Credited to partners current accounts

Debited to partners capital accounts

Debited to partners current accounts

View answer & explanation

Correct answer is B

Each partner has a separate current account and includes;

• The credit side of the current account shows all the profits of the partners

• The credit side of the current account shows all the profits of the partner such as salary, interest on capital and the share of residue profits.

842.

Use the following information to answer the given question.

\(\begin{array}{c|c} & & N \\ \hline \text{Purchases:} & \text{raw materials} & 20,000 \\ & \text{finished goods} & 15,200 \\ \text{Stock 1/1/89:} & \text{ raw materials} & 3,000 \\ & \text{work-in-progress} & 2,500 \\ Wages: & direct & 22,800 \\ & indirect & 7,200 \\ \text{Factory expenses:} & electricity & 12,000 \\ & insurance & 2,000 \\ \text{Stock 31/12/89:} & \text{raw materials} & 4,000 \\ & \text{work-in-progress} & 4,500\end{array}\)
What is the value of raw materials available?

N23,000

N22,500

N20,000

N19,000

N16,000

View answer & explanation

Correct answer is A

No explanation has been provided for this answer.

843.

The concept which states that the affairs of a business is to be treated as being separate from the private activities of the owner is

Realization concept

Business entity concept

Cost concept

Dual aspect concept

View answer & explanation

Correct answer is B

The business entity concept states that the transactions associated with a businessmust be separately recorded from those of its owners or other businesses.

844.

Use the following information to answer the given question.
John and Johnson are in partnership, sharing profit and losses in the ratio 3 : 2. Other information are as follows:

\(\begin{array}{c|c} \text{Capital} & \text{ - John} & N20,000 \\ & \text{ - Johnson} & N10,000 \\ Drawings & \text{ - John} & 2,000 \\ & \text{ - Johnson} & 3,000 \\ \text{Interest on capital} & & \text{5%} \\ \text{Interest on drawings} & & \text{10%} \\ Profit & & N6,000\end{array}\)
Interest on Johnson's drawing is?

N500

N300

N200

N150

N100

View answer & explanation

Correct answer is B

No explanation has been provided for this answer.

845.

Purchases of fixtures and fittings by a club is recorded in the

Receipts and payments account only

Income and expenditure only

Receipts and payments account and balance sheet

Income and expenditure account and balance sheet

View answer & explanation

Correct answer is C

The Purchases of fixtures and fittings by a club is recorded in the receipt and payment account and balance sheet. Fixtures and fittings are assets recorded in the balance sheet and the balance sheet balances is used as the opening balance in the receipt and payment account.