JAMB Accounting Past Questions & Answers - Page 133

662.

When there is no basis of apportionment in an organization, the expenses should be apportioned based on

A.

Sales

B.

Purchases

C.

Equality

D.

Floor space

Correct answer is C

No explanation has been provided for this answer.

663.

When shares are issued at a discount, entries are to debit

A.

Application allotment account and credit discount account

B.

Discount account and credit

C.

Cash account and credit discount account

D.

Discount account and credit bank account

Correct answer is A

No explanation has been provided for this answer.

664.

The purchase consideration that is lower than the net asset implies that, the buyer has gained the advantage of

A.

Net income

B.

Revenue reserve

C.

Capital reserve

D.

Net loss

Correct answer is C

Capital reserve is derived from the accumulated capital surplus of a company, created out of capital profit. 

665.

When a share valued at 50k is issued at #1.59, it is said to be issued at

A.

Par

B.

Premium

C.

Discount

D.

Interest

Correct answer is B

Issue of shares at premium means that the issuing of shares above the face value (also called as nominal value or par value). Simply put, when shares are issued at a price higher than the face value, it is said to be issued at a premium.