JAMB Accounting Past Questions & Answers - Page 120

596.

When the invoice of a customer is overcast, the supplier will send to him a

A.

Debit note

B.

Cheque

C.

Credit note

D.

Payment voucher

Correct answer is C

credit note is a letter sent by the supplier to the customer notifying the customer that he or she has been credited a certain amount due to an error in the original invoice or other reasons.

597.

The accounting concept that allows the cost of kitchen cutlery to be expensed, though it can be used for more than one year is

A.

Materiality

B.

Accrual

C.

Going concern

D.

Business entity

Correct answer is A

Materiality states that only items of material values are recorded e.g. the cost of a stapler should not be capitalized but expensed just as kitchen cutlery.

598.

Prime cost is one of the following

A.

Expenses which can be identified with an allocated to cost centers

B.

Aggregate direct material cost, direct labour cost and variable direct expenses

C.

The cost taken into account in the production process whether direct or indirect

D.

The cost of commodities supply to an undertaking

Correct answer is B

Prime cost is the direct cost of a commodity in terms of the materials and labour involved in its production, excluding fixed costs.

599.

The major distinguishing element between the final account of a partnership and that of a sole trader is the

A.

Drawing account

B.

Capital account

C.

Creditor account

D.

Appropriation account

Correct answer is B

The Major Difference Of The Financial Statement between a Sole Proprietorship And Partnership is More than one capital account. The number of capital accounts depends on the number of partners in the Partnership concern. Profit & loss is distributed to the partners' capital account according to the agreed ratio